The US and North America in general have seen considerable recent movement in real time payment solutions for eCommerce. However, they are still lagging behind compared to other markets in the world. Asia, Europe and even Africa to an extent. The total value of real time payments is set to be $18 trillion by 2025. Surprisingly the US share of the market will account for about 1.4 trillion of that. Representing a mere 8% of the global market share. These figures are according to a study by Juniper Research and make for bleak reading.

Settlements for merchants

However, there is still plenty of cause to be optimistic in the US and North America in general. The FedNow service is an attempt by the government to facilitate real time payment which are key to the growth of eCommerce. Some businesses will benefit a lot from this immediately. For example those that use the funds in the merchant account for, purchasing inventory, paying employees and expenses. Most accounts need a hold period of up to 2 weeks, depending on cash reserves. However the amount of funds, the status of the business account status and the nature of business are also a factor for businesses in this program.


Normally, business accounts are not settled in real-time. This is due to the fact that acquiring banks (i.e., merchant account providers) have to request and receive authorization. An example of an acquiring bank is merchant account providers which are financial institutions approved by card brands (Visa, Mastercard, Discover, American Express) to accept card payments on behalf of a merchant. Acquiring banks also prevent immediate access to funds to protect against chargebacks. However, some merchant account providers now offer real-time settlements to help smaller, independent businesses amid the pandemic in some cases. The most popular is Square’s Instant Payments feature. This allows merchants to fund payroll with the money on their Square account.

For data to underpin bank’s customer relationship and take services to another next level, it is important to break the channel silos. It is also key to extract value from a comprehensive dataset. But with only 18% of banks reporting that they are in the process of shifting from a transactional revenue model to a data-driven revenue model. This work has some way to go.

In conclusion, big financial institutions will be key to the growth of real time payment solutions in North America. Today’s customers expect services that work specifically for them, not just the big financial institutions. All banks, no matter the footprint, need to move quickly to offer a broad digital service platform that adds value to both the customer and the bank. Banks are setting a strong payment strategy. Many of them are competitive because they reduce cost and encouraging innovative practices. This has a big impact on unlocking revenue potential for them and eCommerce businesses.