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Recent research reveals that a significant portion of EU banks are apprehensive about meeting instant payment deadlines, with one-third of banks not currently offering such a service. According to a survey conducted by RedCompass Labs among 200 payment professionals at EU-based banks, 58% of banks without instant payment services perceive the deadlines as unrealistic, while a third express doubts about meeting them.
Despite these challenges, a majority of banks (77%) still recognize the benefits of instant payments outweighing the costs, and over half (55%) intend to offer instant payments as the default option to their clients.
The report, titled “So You Think You’re Ready for SEPA Instant?”, highlights a potential underestimation by banks regarding the scale of processing required. While most banks aim to process between 101-300 payments per second, bulk payment files may contain hundreds of thousands of payments, necessitating a processing capacity of at least 1,000 payments per second, as recommended by RedCompass.
Additionally, the surveyed banks anticipate an increase in IT budgets, with 76% expecting a rise to meet the new SEPA rules, averaging between €1 and €3 million per bank.
RedCompass Labs CEO Tom Hewson commented, “The EU’s new regulation demonstrates that the instant payments revolution has officially arrived in Europe.” However, he acknowledged the concerns raised by banks, stating, “Our research shows that there is understandably some trepidation about the proximity of the timelines and a possible underestimation of how much they need to scale their throughput and invest.”
Hewson emphasized the need for adaptable solutions, stating, “As there is no cookie-cutter solution that will work for all banks, we can expect to see an exploration of alternative approaches that don’t require them to change their core banking systems.”
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