With 56% of financial institutions adopting faster payment technologies and one in three Brits now using mobile contactless payments, the need for robust security measures grows. Recent studies highlight advancements in payment systems and the increasing importance of safeguarding against fraud.
According to research from the Faster Payments Council (FPC), 56% of financial institutions, payment providers and businesses have integrated faster payment technologies in their payment infrastructures.
Over a third, 35%, said they are planning to introduce faster payment technologies in future, while 9% have no plans to.
The data was revealed in the FPC’s Faster Payments and Financial Inclusion report, which surveyed 88 financial institutions, payment providers and businesses to explore the reediness of financial institutions to implement faster payment solutions.
Research shows that 55% of respondents revealed that they don’t charge for faster payments to boost financial inclusivity. Meanwhile, 23% said they charge payers a fee for faster payments, 13% charge the payee and 10% charge both the payer and the payee.
“Our latest survey reveals promising progress in the adoption of faster payments across a diverse range of financial institutions, including banks, credit unions, and payment providers,” said Anthony Serio, FPC Financial Inclusion Work Group Chair. “The survey highlighted concerns related to fee variability, cross-border payment capabilities, and the essential need for stronger consumer protections and trust-building measures.”
When it comes to payment fraud, 42% said they allow customers to ask for a return of funds after an authorised transaction fraud, while 19% don’t allow customers to make those requests.
In total, a worrying 36% said they didn’t know how they handled refund requests from authorised transaction fraud victims.
Responding to the findings, Jason Kurtz, CEO of Basware, commented: “The push towards faster payment systems is a welcome sight, helping businesses to clear invoices and transactions swiftly. Without faster payment infrastructure, payments can be delayed which can cause severe challenges for suppliers when managing cash flow, contributing to stunted business growth.
“Automation emerges as a solution to streamline processes, mitigate cost pressures, and collaborate with suppliers. As CFOs redefine their responsibilities, leveraging technology becomes essential to drive efficiency and ensure financial stability amidst economic uncertainties.
“As part of offering faster payment technologies, businesses should consider introducing early payment rewards. For instance, INNIO’s story underscores the potential; they saved €11m in 2022 from early payment discounts, primarily due to reducing invoice processing time from 20 days to under four.
“However, the lack of awareness around fraudulent payments is a concern. Schemes such as fake invoices and vendor impersonation are becoming increasingly common and finance teams must be savvy to the payments they are receiving. Our research with Forrester highlighted the role that AI is playing in tackling fraudulent activity, helping to identify irregularities in payment data, managing exception handling and responding to abnormal or exceptional conditions requiring special processing. Faster payments offer a positive step for boosting supplier relations, but finance teams must implement it safely to defend against the rising tide of fraud.”
As financial institutions increasingly adopt faster payment technologies, there’s also a notable rise in consumer use of mobile contactless payments. Recent data from Accenture shows that one in three Brits used their phones for contactless transactions last year, reflecting a broader trend towards convenience in financial transactions. This shift highlights the need for both advancements in payment systems and robust security measures to protect users in this evolving digital landscape.