Discovering What’s Possible in Instant Payments

Offering simple, accessible, and affordable solutions built on instant payments can help financial institutions increase business while supporting their customers’ financial goals.

Small-Dollar Loans

Instantly delivered small-dollar loans can help customers build credit, meet short-term financial needs, and avoid expensive alternatives, such as payday loans. Small-dollar loans can cover unexpected expenses, fill temporary cash-flow gaps, or make up for short-term income shortfalls so families and individuals can make it to their next pay day.

Instant Disbursements

Offering disbursements instantly, in the forms of refunds, insurance payouts, or other benefit payments, can have huge benefits for households, particularly those living paycheck to paycheck. They can provide a positive customer experience and may be particularly important in the case of an emergency, when unexpected expenses can wreck a budget.

Instant Bill Pay

Online bill pay is extremely popular, but it can take up to two days to clear and settle a payment. This can lead to service disruptions or late fees and cause stress for those paying bills last-minute. Instant, 24/7 bill pay allows payments to immediately transfer and settle into the biller’s account at any time, which is critical to those with limited cash flow.

FedNow and Financial Inclusion: Why Instant Payments Matter

Instant payments support economic resilience. Improving cash flow helps stabilize the financial lives of individuals and businesses.

Who Benefits From Instant Payments?

Financial Institutions

Instant payments allow financial institutions to:

  • Reduce their customers’ reliance on costly alternatives: Many consumers currently use money orders, retail bill-pay, and payday loans because they offer speed and certainty. By offering instant payments, banks can reclaim these transactions and strengthen customer relationships.
  • Improve customer satisfaction and retention: Survey data shows that 90% of respondents would use their bank account more if instant payments were available. This represents a significant opportunity for institutions to deepen engagement.
  • Enable new services: Instant payments can support earned wage access, real-time bill pay, and instant disbursements for refunds or insurance payouts –services that are increasingly in demand.

Pullquote: “If something is quicker and offers our customers instant gratification, we felt we should probably move in that direction. Who doesn’t want their money faster?” – INB Bank

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