For banks considering adding instant payments, the best outcome may come from focusing on the customer and not the technology.
That was the message from Mark Majeske, senior vice president of faster payments at Alacriti, during a recent ProSight Bankng Strategies Podcast episode on the state of the Real Time Payments (RTP) network, FedNow, and the broader payments landscape. The rails matter, but they are not the best place to start the conversation. Banks can get stuck in “analysis paralysis,” he said, if they focus too early on which network to join instead of what customers actually need and how the institution plans to deliver it.
Here are a few takeaways:
The market is growing, but it is still too early to bet on one rail. RTP has been around longer and handles far more volume, while FedNow has added financial institutions at a faster pace. Majeske’s broader point is that the market is still sorting itself out. With 60% of banks on both rails, many institutions appear to be concluding that this is not the moment to make a narrow bet.
Supporting both rails can actually be the practical move. Majeske explained the logic: “I never want to be in a position to say no to my customer.” But a customer would have to be told no when the receiving institution is not participating in a particular sender’s network. For institutions building an instant payments strategy now, that possibility makes flexibility look less like overbuilding and more like basic customer coverage.
Customers care about the outcome, not the label. Most customers are not asking for RTP by name. They are asking for faster payroll, quicker access to funds, and the ability to move money outside normal banking hours. Majeske pointed to behavior, not branding, as the more useful signal. “They want a bank when they want to bank,” he said. With more than half of RTP and FedNow transactions happening outside business hours, banks do not have to guess very hard about what customers value.
Faster payments require faster controls. A 15-second end-to-end payment changes more than settlement speed. It changes fraud expectations, operating demands, and service models. Banks cannot assume the same tools and review processes used for ACH and wires will hold up in a real-time environment. In Majeske’s view, addressing this is also an opportunity to modernize older processes that may have needed attention anyway.
Do the product work before launch. Majeske’s mantra suggested a basic discipline: start with what customers and members will value, involve the right teams early, and set realistic goals. Or, as he put it, don’t “bypass the time-tested practice of true product development.” Banks that do that work up front will be in a better position to build something useful—not just something new.
