Majority of Smaller FIs Rely on Third Party Help for RTP Implementation

Introduction

It should be of no surprise that the majority (84%) of smaller financial institutions (FIs) are reliant on third-party assistance in launching real-time payments (RTP). Most smaller institutions battle against lack of internal resources and rely heavily on third parties for a number of functions, including online and mobile banking front end. This leads them to seek help in a few ways for RTP:

• Strategic approach to RTP (when/how to launch)
• Intermediary services to The Clearing House (fraud, messaging, account validation, etc)
• Servicing and liquidation services
• Education (often from existing vendors)

These institutions are deciding if, how, and when to launch RTP, how the new service will fit into their technical stack, how to present it as a product to their clients, and much more. The resources and insight needed to perform all of these tasks in addition to business-as-usual items often become overwhelming, and in some cases impossible. This leads these institutions to seek outside help, especially with something as potentially transformative as RTP.

Smaller institutions also realize their technical stack and fraud monitoring capabilities often are not sufficient to take full advantage of, nor properly monitor, RTP as a service. Many third parties have created productized solutions for RTP that allow these smaller institutions to participate without doing most of the heavy lifting. In addition, technical support is often needed to integrate with a servicing solution, which is often also provided by a third party technical provider or consulting group.

Conclusion

Smaller institutions are able to take advantage of RTP, but they will need assistance in order to fully realize the benefits it can offer them and their clients. RTP has the potential to transform the organization as well as the payments industry and should be approached with research and preparation. Third-party services are able to fill gaps in smaller institutions so that they are able to launch RTP in a way that will be strategic and forward-looking.

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