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RTP® Network Poised to Increase Payments Efficiency as Businesses Continue to Move Away from Checks

Paper persists. In a recent survey, Citizens Financial Group found that almost half of the roughly 150 companies it profiled were in talks to join the growing RTP® network and that, surprisingly, 75% of businesses still make payments by check.

Citizens Head of Treasury Solutions Michael Cummins argues that banks shouldn’t delay in implementing an RTP solution. They run the risk of losing clients in a competitive climate, he tells American Banker.

Here’s a short sample of what findings surprised Citizens Financial Group, why paper checks persist, and why banks should be offering real-time payments to their customers.

American Banker: Was there anything [in the survey] that surprised you?

Michael Cummins, Citizens Financial Group: It still surprises me that so many of our customers continue to use paper and cash. I’ve been in the cash-management business for the better part of 30 years. For that whole time, we’ve talked about how paper is going to come out of the system and it’s all going to be electronic. When you think about some of our counterparts across the globe, they’ve adopted electronic payments much more quickly than we have in the United States.

From our survey, 75% of businesses still make or accept payments using checks and 45% still make or accept payments in cash. That was a real surprise to me … more so than anything cash. Where are these people?

AB: You see real-time payments as a game-changer in coming years. Can you explain why?

Cummins: I feel that real-time payments will be a catalyst to change these percentages — for sure.

The precise nature of real-time payments, with the appropriate level of information that follows each payment, is going to change how companies make payments from a cash and a check perspective.

My generation, I’m 52, has held on to [checks]. The younger generation has never seen a checkbook. They know they’re out there and they exist, like Bigfoot. They don’t actually use them. Their whole lives have been [about] electronic payments. I think that, coupled with real-time payments, is really going to have an impact on paper checks and cash.

I’m a firm believer that real-time payments should be adopted by all banks because it is market leading. It’s the first new payment rail in over 40 years. It’s going to help customers be more efficient. … At the end of the day, as a banker that’s our job, to help our clients.

AB: Is the technology ready?

Cummins: The infrastructure is there. If you look at Citizens, we have the capability to receive and send real-time payments. We're up and running. The Clearing House’s rails are running. The product has been built. There are a number of banks on the rails.

Read the entire American Banker interview. (Registration required)

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