Real-time Payments Architecture Guide Episode 2: RTP vs ACH Integration Differences

See our 2019 RTP Readiness Report: https://bit.ly/2VpEBSB

Read our 2019 RTP Implementation Guide: https://bit.ly/2FWBfkl

See our RTP architecture vlog in its entirety: https://www.levvel.io/blog/real-time-...

See our RTP product and design vlog in its entirety: https://bit.ly/2wus5pL

See our RTP strategy vlog in its entirety: https://bit.ly/2Uas2Oo

If you're a bank looking to integrate with RTP, you should be aware of some of the biggest differences between RTP and another payment type such as ACH. The three differences I want to highlight are first moving from batch-based processing to real-time. Second, real-time payments are irrevocable. And third, RTP is a credit push only system.

First, one of the biggest shifts in integrating with RTP, versus another payment type such as ACH, is the move from batch-based processing to real-time processing. So this is a shift that's not unique to financial institutions in RTP. It's really happening across many different industries and domains, and it's occurring because customers continue to expect more and more of their interactions to be real-time.

So from smart speakers to social media, to video streaming services, customers expect systems to be up 24/7 and to be responsive. Banking is not immune to this expectation.

A second big difference between RTP versus ACH is the fact that real-time payments are irrevocable. This means that once the money is sent and both the participating FIs accept and acknowledge the credit transfer, the money moves, and there is no concept of a reversal. This is a different paradigm and takes some getting used to, but it also has some advantages of removing the complexity of things like reversals.

A third key difference between RTP and ACH is that RTP is a credit push only system, so there's no equivalent of an ACH debit. This, again, has its tradeoffs, but it puts more control back into the customer's hands.