Seizing the instant payments opportunity

Imagine a food delivery worker in São Paulo finishing their shift on a Friday and receiving their daily earnings within seconds of leaving the office – ready to take their family out to dinner. Or a taxi driver in Delhi who receives payment for an airport ride via QR code and can immediately use that money to refuel, without waiting days for settlement. This is reality in markets such as Brazil and India, where the respective national instant payment initiatives – Pix and UPI – have transformed the national payment landscape. 

The story in Europe is a little different. Despite having the technology readily available, in the form of SEPA Instant, which has already enabled such transfers between participating banks since its launch in 2017, real-time payments haven’t yet gone mainstream – just 11% of all euro money transfers are instant.¹

There are some good reasons for this. Unlike in emerging economies, where fragmented and inefficient systems made the case for a unified payment program compelling, Europe already offers a reliable mix of seamless, fast, and convenient payment options – whether card, mobile wallet, or national debit programs. For most consumers, these options are enough.

​​At the same time, expectations around how quickly money should move in today’s digital economy are shifting. Merchants want faster settlement and lower fees. Consumers want more seamless payment experiences, without compromising on security or privacy. Meanwhile, banks are facing challenges on several fronts – from keeping pace with rapid technological change and ever-increasing regulation, to staying ahead of fraudsters and competing with fintechs and new entrants.

It is against this backdrop that the latest deadline of the EU’s Instant Payment Regulation (IPR) comes into force on October 9, 2025. From this date onward, all banks and payment service providers (PSPs) in the EU must provide the option to send euro credit transfers that settle within 10 seconds, around the clock, every day of the year. 

For some incumbents, the change may come as just another compliance obstacle. In reality, it is much bigger than that.

Bridging the gap between banks and customers

The emergence of instant payments provides consumers with an alternative to cards, which remain the dominant payment method in Europe, accounting for €1.7 trillion in transactions in the second half of 2024 (an increase of 9.4%).² However, the World Payments Report 2025 predicts that account-to-account (A2A) instant payments could catch up and offset 15–25% of future card transaction volume.³

This shift has the potential to disrupt established payment ecosystems by introducing new competition, creating more choice for consumers and businesses. In turn, this competition can put downward pressure on fees across all rails. For merchants, this could mean lower acceptance fees and faster settlement. For banks, it’s an opportunity to explore new revenue streams on top of instant rails.

However, the real benefit of reducing the dependence on third-party programs has nothing to do with lower costs: it’s about closing the distance between banks and customers. Through instant payments, banks can reassert their presence at the point of interaction and also retain the transaction data that enables personalization, loyalty programs, and other value-added services. Crucially, such services can more than offset any lost interchange revenues caused by a drop in card usage: banks that offer personalized embedded finance services see three to five times higher customer lifetime value than those relying solely on traditional card-based models.⁴

Examples of such offerings include real-time marketplace payouts, where platforms can settle instantly with sellers, or on-demand wage access, giving employees more financial flexibility between pay cycles. Insurers are also experimenting with instant claim disbursements, turning a formerly cumbersome, paper-heavy process into a seamless customer experience.

In each case, banks are the enablers providing the regulated instant payment rails that allow money to move instantly and securely, while keeping themselves at the center of the transaction. The question now is whether they are ready to deliver such benefits, while also reaping the rewards.

“Verification of Payee will be a vital trust anchor for instant payments,” says Martina Forster, Portfolio Owner Payment & Identity at G+D Netcetera. “By validating the receiver account details before settlement, banks can give consumers confidence in new rails, while reducing the risks of misdirected or fraudulent payments.”

Security as the differentiator

Even if instant payments are faster, cheaper, and more convenient than card payments, mass adoption will depend on how secure consumers and merchants feel using them. Banks can strengthen user confidence by combining safeguards such as VoP with other embedded security features, such as biometric authentication, passkeys, behavioral analytics, and AI-driven fraud detection. For even more security, banks and PSPs can collaborate on real-time data-sharing to aid fraud detection efforts and increase resilience across the board. Combined, these measures keep real-time transactions secure while reinforcing the banks’ position as trusted custodians of money. 

Looking further ahead, the next challenge will be at a systemic level. For instant payments to realize their potential, especially in cross-border contexts, Europe must address the interoperability and governance gaps that hold adoption back. Whether initiatives like the European Payments Initiative (EPI) can set rules that make A2A economically attractive for domestic wallets, issuers, and acceptance partners will also be a competitive factor. 

With the October deadline approaching, it’s important that banks look beyond fulfilling compliance obligations. The real opportunity is to use instant payments as the foundation for the next generation of banking – one that puts customer relationships, transaction data, and trust back in their hands.

As a global payments leader, G+D helps financial institutions turn instant payments into an opportunity – from ensuring regulatory compliance to enhancing security and delivering world-class customer experiences.

Podcast: Future Proof with Martina Forster: Digital payments beyond card rails

Published: 30/09/2025