23 November 2022

Growing instant payments in Europe and around the globe:
RT1 supports Italian banks on their frontrunner journey

On 21 November, EBA CLEARING’s instant payment service RT1 celebrated its fifth birthday. The first pan-European instant payment service has been a decisive driver of the real-time payment ramp-up across Europe:  RT1 today reaches 85% of bank customers in SEPA and processes over two million transactions worth 1.5 billion euro per day on average – and volumes continue to grow by up to 50% on an annual basis. All transactions are settled with immediate finality in central bank money with inter-PSP processing being completed in around one second, across all corners of Europe. The system operates 24/7 based on the SCT Inst Scheme of the European Payments Council; it is the industry’s instant payment infrastructure of choice, as testified by the more than 2,500 PSPs from 29 countries connected to RT1. 

Italian banks were among the pioneers of real-time payments in RT1 and continue to add new chapters to their instant payment journey:  

“The adoption of instant payments for our different customer segments, channels and European countries has been a real success,” says Raphael Barisaac, Global Head of Cash Management at UniCredit. “Enriching our instant payments offering by developing value-added services, such as IXB or Request to Pay, is also fundamental for the further evolution of the digital payments market, which can be facilitated by the scalability of RT1 and the availability of the advanced liquidity management tools it incorporates.”

While the majority of payment accounts in Europe are already reachable via RT1 today, the full reach to be established by the future EU Regulation on instant payments proposed by the European Commission is crucial to creating ubiquity for end-user solutions based on instant payments.

“The experience gained from pioneering instant payments in RT1 allows us to efficiently manage the growing volumes of instant transfers,” says Stefano Favale, Head of Global Transaction Banking, IMI Corporate & Investment Banking Division at Intesa Sanpaolo. “Accelerating adoption across Europe will pave the way for large-scale rollouts of innovative real-time customer offerings. At Intesa Sanpaolo, we are excited to leverage proven systems for products that further speed up and improve our customers' payment experience. This, together with the development of the IXB project, which will bring RT1 into the cross-currency dimension will bring instant payments to their true potential in the short term.”

RT1 is also well-prepared to onboard soaring instant payment volumes and support payment service providers across the continent in bringing their payment business up to speed in line with the requirements and timelines of the forthcoming Regulation: “RT1 has the resilience, scalability, liquidity management tools and flexible access options to optimally serve the needs of our users shaped by the European Commission’s agenda. A clear impetus of this agenda is for the market to leverage instant payments for innovative payment solutions. All our efforts are focused on optimising RT1 to enable our users to create these solutions and monetise their investments in instant payments,” says Hays Littlejohn, CEO of EBA CLEARING.

He adds: “RT1 provides the easiest adoption path for instant payments, thanks to its maximum alignment with our STEP2 system, which all PSPs in Europe are using today for their SEPA credit transfers and direct debits. Another advantage is that RT1 comes with built-in connectivity to TIPS. RT1 joiners get access to two instant payment systems while only having to go through one implementation project.” As operator of STEP2, the largest pan-European retail payment system in terms of participation, EBA CLEARING also has vast experience in orchestrating major onboarding exercises and provides extensive testing support to make user adoption – and the path to an enhanced pan-European payments ecosystem – as smooth as possible.

But the advantages of RT1 do not stop there. To extend the convenience of instant payments across borders beyond SEPA, EBA CLEARING has joined forces with U.S. payment system operator The Clearing House (TCH) and SWIFT. With the support of 25 financial institutions from across the Atlantic, an Immediate Cross-Border Payments (IXB) pilot service will be kicked off in the coming months. The IXB pilot leverages EBA CLEARING’s RT1 and TCH’s RTP®, as well as key SWIFT components, for transactions in the euro and U.S. dollar currency corridor. The IXB model is designed to be replicated with other similar payment systems and in other currencies. Together with market- and regulation-driven developments in the European Union, IXB has the potential to open up an important growth path for instant payments, which should benefit customers in Europe and, eventually, around the globe.

This article was published by Bancaforte in Italian on 23 November 2022. To read the article in Italian, click here.