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The real-world-impact of real-time payments
As the banking industry moves closer to adopting a faster payments system, bank executives have begun to think through the impact it will have on clients and banks themselves.

Commercial banking clients are likely to reap the biggest and most immediate benefits from the change, bank executives say, noting that real-time settlements will help businesses trim expenses. Consider the mounds of paper checks and invoices that could be eliminated — not to mention the costs associated with high-cost wire transfers.

Consumers also stand to benefit. Instantaneous updates to their checking accounts will help them keep closer tabs on their spending and avoid overdrafts, executives said.

For banks themselves, of course, the picture is a bit more mixed. In order to differentiate themselves in the industry and keep pace with client demands, banks have invested heavily to upgrade their technology. They also have done so with the expectation that, as clients grow more comfortable with faster payments, various sources of fees — from interchange to overdrafts and merchant acquiring — may decline over time.

Bankers shared their thoughts on the impact of faster payments during an industry conference last week. The event was sponsored by The Clearing House, which last month received a green light to move forward with its real-time payments network, following an antitrust review by the Department of Justice. A Federal Reserve task force, meanwhile, has set a goal that anyone with U.S. bank account should be able to receive real-time payments by 2020.

Here’s an overview of what bankers and other payments executives are expecting.