Instant payments are in their infancy compared to alternatives like Same Day ACH, but in a fraught economy, the certainty of instant money may catalyze usage and growth.

Given the amount of media attention that instant payments have been receiving since the pandemic hit in 2020, it’s fair to wonder why more business payments don’t use these rails.

Let’s look at who’s putting up big numbers: The Clearing House (TCH) RTP® network launched in 2017. In 2024, RTP grew a stunning 94% and sent $246 billion in payments. The FedNow® Service has processed a total of roughly $87 billion since inception in July 2023.

For Same Day ACH, a total payments value of $3.23 trillion in 2024 reflected YoY growth of 45.3% according to Nacha. Same Day ACH is growing far faster than overall ACH network payment volume, which rose 6.7% YoY in 2024 (minor by comparison).

It could all leave instant payments with an inferiority complex, but it shouldn’t. The fact is that these things take time. Rodney Nilson, Vice President of Product Management at Bottomline, explains that while financial institutions can receive instant payments through FedNow, for example, there's a substantial gap in FIs that have enabled the ability to send instant payouts.

"While financial institutions have received FedNow and TCH payments, origination capabilities are lacking," Nilson says. As he sees it, the disparity between technical readiness and practical implementation stems largely from an education gap.

Nilson feels that end-user businesses remain largely unfamiliar with instant payment options. "Despite the media hype, end-user businesses are not well-informed about instant payment options like FedNow and TCH," he says.

This lack of awareness creates a significant barrier to adoption, particularly for businesses that have established payment processes. The traditional business payment framework operates on extended timelines that don't necessarily align with instant payments.

"Businesses often operate on net 30 terms, which doesn't require instant payments," Nilson says. This established practice means that many businesses don't see an immediate need to change payment formats, regardless of the potential benefits of instant.

 

Strong Value Propositions and Intraday Cash Needs

For instant payments to gain traction, they must offer more than speed. Nilson says changing established B2B payment behaviors requires compelling incentives.

"The value proposition must go beyond just being instant," he says, adding that integration with existing ERPs and other such systems represents one of the most powerful levers.

Nilson says "Integration with back-office systems can be a significant trigger for adoption.” When instant payments seamlessly connect with accounting software, ERP systems, and other business tools, the friction of adoption decreases substantially, making the transition more appealing to businesses of all sizes.

Speaking of size, small and medium-sized businesses (SMBs) present an especially promising market for instant payment rails. "SMBs are more likely to adopt instant payments because their behavior closely resembles consumer behavior, which has already embraced real-time payments through services like Zelle and PayPal," Nilson says.

This consumer-like approach to business transactions makes SMBs more receptive to innovations that mirror their personal banking experiences. So, in unpredictable markets, instant payments offer additional value through improved liquidity management.

"Volatility increases the need for intraday cash liquidity, making instant payments more important," Nilson says. When economic conditions fluctuate rapidly, the ability to move funds instantly provides businesses with greater control over their cash positions, enabling more agile responses to market changes.

 

Can Instant Payments Help Tame the Turbulence?

When talking about paying and getting paid, enabling instant B2B payments can be seen as a way of settling roiled markets, and bringing some calm to the situation.

"Instant payments can reduce market volatility by providing more confidence in transaction completion and reducing perceived risk," Nilson says. When businesses know that payments will clear immediately, when they see it happen, they can operate with greater certainty, potentially smoothing out some of the peaks and valleys of rough markets.

Confidence also extends to business relationships. In uncertain economic times, payment reliability becomes another kind of currency. "Instant payments can make transactions more trusted and remove apprehension about potential risks," Nilson says.

This trust factor is particularly valuable when businesses are navigating relationships with new partners or operating in unfamiliar geographies. For financial institutions serving business clients, the generational shift also presents challenges and opportunities.

 

Instant Payments and the Next Generation

As millennials retire and Gen Z takes on leadership roles, payment preferences are shifting.

Younger generations show a strong preference for mobile payments and digital solutions, creating pressure for financial institutions to modernize B2B offerings. Smaller financial institutions face particular challenges in keeping pace with these changes.

"Smaller institutions need to step out of their comfort zones and partner with fintechs to stay competitive," Nilson says. Without these partnerships, smaller banks risk losing business customers to larger institutions with more advanced payment capabilities.

The future of B2B payments will likely see increasing consumerization, with business payment experiences becoming more like those seen in the consumer world. This trend aligns with the growing uptake of real-time payments, which offer significant advantages for businesses in terms of cash management and visibility.

Bottomline is among the few Payment Service Providers (PSPs) offering access to the FedNow and RTP® networks to clients wishing to utilize instant B2B payment capabilities.

"Real-time payments allow businesses to hold onto funds longer, providing control and benefits," Nilson notes, highlighting that even if businesses pay at the last minute, the improved visibility and control of instant offer substantial operational advantages.

As market conditions keep shifting, businesses that embrace instant payment capabilities position themselves to respond more effectively to instability while building stronger, more trusted relationships with their partners.

The transition may require investment in education and systems integration. Yet the potential benefits in terms of liquidity management, operational efficiency, and reputational confidence make instant payments an increasingly valuable tool in the B2B payments toolkit.