Instant payment is not a trend of the future – it’s a comeback. Thousands of years ago, trade was simple and a “real-time thing”: goods for money, instantly, directly, without waiting. This principle of immediate payment is deeply rooted in our economic understanding. Today – in a world where even seconds matter – this idea is returning in digital form: as instant payments.
Cash is on the decline, digital payments dominate our everyday lives, and initiatives such as the digital euro point the way forward. What used to be a handshake at a market stall is now an API-based real-time transfer – secure, immediate, and available at any time.
Who benefits from real-time payments
Instant payments are electronic transactions that are executed and credited to the recipient’s account within seconds – around the clock, 24/7, 365 days a year. This is made possible by new infrastructures such as the SEPA Instant Credit Transfer scheme (SCT Inst) in Europe, which enables transfers of up to €100,000 within ten seconds – across banks.
Instant payments offer a wide range of use cases: private individuals appreciate the speed, reliability and significant increase in everyday convenience, for example by being able to send money spontaneously.
Not only do online merchants benefit from immediate payment receipts, but businesses in general gain from real-time liquidity, fewer payment defaults, and far more efficient cash flow management. Instant payments can be used for rapid salary, invoice or insurance payouts.
In sectors such as second-hand goods trading, fintech, public authorities or at the point of sale, real-time payments increase efficiency, security and customer satisfaction.
Banks and payment service providers also benefit from a strategic lever in an increasingly competitive market.
Between potential and obligation: Where the market stands
The instant payments market is at a turning point: according to current estimates, around 25% of all cashless transactions in Europe will be carried out in real time by 2027 – and the trend is rising. For banks, fintechs and payment service providers, this opens up enormous growth opportunities: new business models such as request-to-pay, real-time factoring or embedded payments can only be implemented effectively with instant payments.
At the same time, regulatory pressure is increasing. With the “Instant Payments Regulation Package” – abbreviated to IPR for Instant Payment Regulation – the European Commission has made it clear that real-time payments are no longer an optional feature but are to become the new standard, with fixed deadlines for implementation and interoperability. These deadlines stipulate that payment service providers in the euro area must support incoming instant payments from 9 January 2025 and outgoing instant payments from 9 October 2025.
However, with the potential come challenges: outdated core banking systems, the lack of API standards, the cost of infrastructure modernisation, and security concerns over fraud detection are still preventing widespread adoption in many places.
Technically ready – or just apparently so?
In addition, the introduction of the EU Instant Payments Regulation (IPR) poses significant technical challenges for banks. Many institutions already have systems capable of processing instant payments in principle – but the requirements of the IPR go considerably further: payments must be processed around the clock, 365 days a year, within a maximum of ten seconds – reliably, securely and in real time. This means that legacy systems must be modernised, back-end processes fully automated, and payment systems designed to be highly available and scalable.
There are also additional requirements such as real-time fraud detection, IBAN/name checks, connection to the SEPA Instant network, and compliance with new reporting and transparency obligations. Many banks are therefore faced with the question of whether to upgrade their infrastructure themselves – or to rely on specialised fintechs that offer modern, modular solutions. Providers such as Qwist support this with scalable, cloud-based platforms that integrate seamlessly into existing core banking systems and already meet the regulatory requirements of the IPR today.
Conclusion – Key Takeaways
Instant payments are more than a trend: they bring the age-old principle of immediate payment back into the digital world – fast, secure and available at any time.
- The IPR makes real-time payments mandatory: with the new EU regulation, instant payment becomes the binding standard for banks in the SEPA area.
- Technical challenges are considerable: real-time capability, 24/7 operation, fraud detection and interoperability require deep modernisation of banking infrastructure.
- Fintechs offer practical solutions: providers such as Qwist support this with scalable, compliant platforms that integrate seamlessly into existing systems.
- Now is the time to act: those who invest early secure regulatory certainty and gain a genuine competitive advantage in the payments landscape of the future.
Want to learn more about Instant Payment?
Click here and read the full Article
Historical overview: The path to real-time payments
The idea of transferring money within seconds may seem modern – but the journey to get here is the result of decades of developments in payment systems.
The early days: Manual transfers and paper forms
Until the 1990s, payment processing in Europe was largely paper-based. Transfers were recorded on forms and processed manually in several steps – with processing times of several days.
Digitalisation of payment processing (1990s–2000s)
With the spread of online banking, payments could for the first time be submitted digitally. However, actual processing by banks still took place in batch procedures, usually only on working days and at fixed clearing times.
SEPA as the basis for harmonisation (since 2008)
With the creation of the Single Euro Payments Area (SEPA) from 2008 onwards, a foundation for cross-border payments was established. The SEPA Credit Transfer reduced processing times to one banking day – a major step forward, but still not real time.
The breakthrough: SEPA Instant Credit Transfer (since 2017)
In 2017, the SEPA Instant Payment scheme (SCT Inst) was launched in Europe. For the first time, it enabled transfers in under 10 seconds – around the clock, 365 days a year. This was made technically possible by new infrastructures such as the European Central Bank’s TIPS system.
Current development: From niche product to new standard
What began as an optional feature is now becoming mandatory: the EU plans to make instant payments compulsory for banks by 2025. This puts Europe on the brink of a fundamental transformation in payment systems – comparable to the introduction of online banking.
