The Send Side of Instant Payments: How RTP® is Transforming Business

EPISODE SUMMARY

In this episode of Wrestling Payments, Jim Colassano, Senior Vice President at The Clearing House, joins host Joe Casali to discuss the transformative impact of the Real-Time Payments (RTP) network. He explains how RTP is revolutionizing how businesses manage payments, particularly on the send side. Jim highlights the shift from traditional batch processing to instant payments, emphasizing the network's ability to handle various transactions, from payroll and refunds to emergency funds and cash flow management.

Jim details how RTP's speed, finality, and 24/7 availability are key advantages over older systems. He addresses common misconceptions and objections, assuring listeners that RTP offers solutions for businesses of all sizes. Jim also dispels the myth of a single "killer app," demonstrating how RTP's versatility allows for diverse applications tailored to individual needs.

Finally, Jim discusses the network's growth and the increasing demand for real-time payment capabilities. He encourages businesses to explore the RTP network and its potential to solve their payment challenges. Jim emphasizes the importance of embracing new technologies to improve efficiency and customer experience.

GUEST-AT-A-GLANCE 

Name: Jim Colassano 

What he does: SVP, Product Development and Strategy 

Company: The Clearing House

Noteworthy: Payments expert with experience spanning from lockboxes to real-time innovations.

Where to find him: LinkedIn

KEY INSIGHTS

The Power of Real-Time Payments Extends Beyond Speed

While speed is a significant advantage of RTP, the benefits extend to transparency, finality, and 24/7 availability. These features address long-standing challenges with traditional payment systems, like clearing delays and revoked funds. This creates a more efficient and reliable payment experience for businesses, allowing for better cash flow management and improved customer satisfaction. The always-on nature of RTP also enables businesses to handle time-sensitive transactions and emergencies effectively, regardless of traditional banking hours. This shift towards real-time information and settlement creates a more robust and responsive payment ecosystem.

Moving Beyond the "Killer App" Mentality

The RTP network isn't about finding one perfect use case; it's about solving a multitude of payment problems. Its flexibility allows for customization across diverse industries and business sizes. This adaptability eliminates the need for a one-size-fits-all approach, allowing businesses to tailor solutions to their specific needs. Whether it's streamlining payroll, expediting refunds, or managing large-dollar transactions, RTP offers a versatile platform to address various pain points within the payment process. This approach focuses on solving practical problems rather than searching for a single, elusive "killer app."

Early Adoption and the Power of Experience

Getting started with RTP is key to unlocking its full potential. The network's value becomes clear with repeated use, as businesses discover new applications and efficiencies. Starting with internal processes, or "eating your own dog food," allows banks and organizations to gain firsthand experience and understand the benefits before offering services to clients. This approach not only improves internal operations but also provides valuable insights to tailor solutions and address client needs effectively. The high rate of repeat usage demonstrates the network's value and encourages wider adoption.

Transcript

NEACH-Wrestling Payments - The Send Side of Instant Payments

SEASONE 3, EPISODE 19

Jim Colassano: [00:00:00] don't look at the customer that we're talking about. Look at the application. What are they using it for? Businesses big and small have to pay their employees. So when you talk about these early wage access capabilities, that's offered to a business no matter what size. Because employees have that same need, whether they're working for a large organization, whether they're working for an online organization or traditional small businesses, they have need for those types of services.

Joe Casali: Hi, welcome to Wrestling Payments. I have a very special guest today, Jim [00:01:00] Colassano. Jim, I've seen you all over the country this year, but for our audience, do you want to introduce who you are and where you're from? Hi.

Jim Colassano: Sure. my name is Jim Colassano. I am a Senior Vice President at The Clearing House, and I am the Business Product Management executive for the RTP Network. I've been with The Clearing House now about eight years. and was here from the launch of the network all the way through the current period. So I've been here from its birth right through current day.

Joe Casali: All right, and we have two, two quick questions I want to get out of the way before we get into the, the meat of the matter. question one is, do you have a favorite professional wrestler?

Jim Colassano: I'm gonna answer that question and I'm actually gonna really show my age here. so I'm gonna say Bruno Santino. Who was somebody I used to watch when I was very, very young and somebody who was a, an idol of mine when I was growing up.

Joe Casali: Excellent. Now me too. He's the, you know, he's the old gangster. He was, he was great. Led the industry for a really long [00:02:00] time. the other question is, how did you get into payments? Did you, as your small child, as you was watching wrestling, did you say, I wanna be in payments?

Jim Colassano: Well, I've actually been in payments my entire career. 

Joe Casali: Mm-hmm.

Jim Colassano: so I think, I definitely qualify as a payments geek. 

Joe Casali: Yes.

Jim Colassano: I started my career in lockbox back at, what was then Chemical Bank, which was like the sixth generations ago. Chase Manhattan Bank, right? and when I got into banking and dealt with, with that lockbox operation, I was able to see everything.

 it's like an encapsulation of everything that goes on in payments. Moving money, float, high interest rates at that period of time, over 20%. putting checks on planes, individual checks and small batch of checks on planes and flying them to the banks so that you could collect on the money a day earlier.

It was all incredibly fascinating to me, and at that time I was actually [00:03:00] going to college. and I was, going to college, getting my master's in finance at the time, and it was a very interesting way of kind of, really bringing to life what I was learning in the classroom. And I just stayed with it throughout my entire career through different banks, the clearing house organization, and lots of different roles.

So I've seen payments from a technology, from an operations, from a business, from a sales perspective, from a product perspective. So I've seen it from every angle. and I think it, it's more and more fascinating. the more things I got involved with and the opportunity to join the real time payments network, the first new payments infrastructure to be built in the US in 50 years, is a great capstone, that leverages a lot of those learnings that I picked up over the years.

 so it's something I'm, I've been very, very excited aboutsince my, younger days and I've stick with it and it still excites me.

Joe Casali: I would love to have you back and talk about that someday you went from paper the fastest payment in the world. So

Jim Colassano: Absolutely.[00:04:00] 

Joe Casali: for another, uh,

Jim Colassano: Mm-hmm.

Joe Casali: today I'm really, really interested in and we've had our members ask a lot of questions. Lots of people are getting into instant payments and instant faster payments and it's almost like a, they're dipping their toe into the water. 'cause the, you know, the overall message is you need to be in instant payments. But the, I don't think there's a lot of conversation from my members, at least on the send side of payments. And you guys clearinghouse, RTP, you have a lot of experience. I would, you know, from my perspective, you guys are a pioneer in the send side 'cause you. You started from nothing. There was no instant payment system, and you got all the players rolling. start that story? I, I'll have questions along the way, but.

Jim Colassano: Sure. well, the, the first thing I, when I talk to people about how we actually formed the network. the one thing that people I don't think realize is that we had to build both sides, right? You can't start on day one. Everybody wanted to send, but if you've got nobody to [00:05:00] receive, then it doesn't make a difference.

So the early stages, we were really focused on getting endpoints and getting reach. we had a lot of customers, a lot of, organizations that were interested in starting to send these transactions. but we really needed to build up that base. Once we built up that base, we started to see some early adopters.

PayPal was a very early adopter. One organization started using it very, very early on. we started to see some that were really focused around the instantaneous nature of it, right? They had experiences on the front end that were, immediate and instant. But the settlement process took a while. we now at this point.

Have almost 75% reach across the country. And for many of the use cases that we see up over 90% penetration. So I'll harken back to some of my lockbox days. What we used to do back in lockbox, we used to do endpoint analysis all the time to figure out where you should [00:06:00] put your, your lockbox operation. we do similar analyses now with many customers who want to come on the network.

Because the question I get is, well, if you can only reach 70% of my customers and you don't have every bank in the country on yet, at what point should I start participating? And we ask them, where are the endpoints? Who are you trying to, to reach? And in most instances, we can reach well over 90% of the customers of many of the senders on the network.

So once you get over that hump of reach, then you start to take a look at what the value proposition and what the use cases are for it. and only one component is really related to the speed. The speed is very, very important. But the transparency, the finality, the 24 by seven nature of these transactions, and most recently, the fact that we increased our individual transaction limit from 1 million to $10 million are opening up use cases so that banks who are now just kinda looked at this and said, I'm gonna dip [00:07:00] my toe in the water and just start to receive.

So that my customers,if they drive for Uber, they'd be able to get their money sooner. 

Joe Casali: Mm-hmm. 

Jim Colassano: Now they're saying, my customers would like to be able to use this capability in lots of different ways, and they're enabling it. Banks are enabling it for customer, for consumers that want to move money between wallets or accounts that they have at brokerage firms and other banks.

 because I don't think people realize how difficult it is to move money between accounts that you may own as an individual. And there are lots of them out there nowadays. So that's one area where we're seeing a massive increase in activity. access to payroll, earlier. Access to payroll. We talk early on about gig economy activity that you wanna get paid out when you finish your shift if you're a driver for DoorDash or, or whatever.

 but now if you're a traditional employee. And you want to get early access to your wages. There are many cust, there are many organizations that are offering that capability right now, but you've [00:08:00] gotta get, you have to have a mechanism to be able to get that money in the hands of your employees as soon as they want it and when they want it.

And emergencies in terms of cash that people need never happen during business days. They always happen in the middle of the night or on the weekend. So using instant payments in that 24 by seven cycle is, is one way of really achieving that goal. and then the last thing that we are seeing is really cashflow management.

With the increase of the dollar limit from, a million to 10 million, what we're seeing is an explosion in merchant settlement activity. So not only do individuals need to get their funds when they need them, 24 by seven, but businesses do also that need for cash flow and the immediacy of receipt when you need it.

Especially in the current environment where interest rates are starting to take up again, it's extremely important to both consumers as well as to businesses. And what we're seeing is now organizations that were starting to say, [00:09:00] okay, let me receive it so that my customers don't miss out on the benefits.

Now their customers are coming back and saying, well, it's good that I can get these these funds, but I want to be able to actually send money the same way I wanna be able to manage my cash flow on the outgoing side. And make payments exactly when they're due, as opposed to a week beforehand. especially those customers who are paying bills.

 and I always use this example, and it's the one thing that resonates with everybody who pays a bill on bank bill pay systems. You enter your information, they take the money out of your account instantaneously, and then you get that popup that says, your account may be credited in seven days. And everybody just throws their hands up in the air.

Imagine an environment where you can make that payment on the day your biller says it's due, and know with certainty that your payment's actually gotten to that biller and that your account is settled. That means a lot. And those are the expectations that consumers have nowadays. Those are the [00:10:00] expectations that business have nowadays.

And enabling Send is the logical next step. And again, part of this is meeting the expectations of your customers and your businesses. And send is where the action is. That's where the expectations are right now, and that's what banks are doing.

Joe Casali: And so I, I had the questions po listing as, as you were talking, just accumulating. That is my favorite feature of the, the entire thing. In fact, the idea that. Not only can you know, you sent it, you can know it's there. I love that part. so that the just, accumulated questions. Sometimes I nod and I seem like I know what I'm talking about. So I know, I know gig economy, I really just listened for the first time. And you said we're early wage access, that's a, a function where a regular employee just needs a little bit of advance on their own salary now. and

Jim Colassano: Right.

Joe Casali: okay. and that's happening.

Jim Colassano: So the way that happens today, 

Joe Casali: Mm-hmm. [00:11:00] 

Jim Colassano: and most people are familiar with it, or payday loans, right? If you need early access to your money, you go to a payday lender, and then they will loan you money. Against your paycheck. and you obviously pay money for that service. it's all associated with that.

 what you see with these early wage access capabilities is that if you've worked for two days, you have earned wages for two days and you should be able to get access to that money without paying anybody a fee. Right? 

Joe Casali: Mm-hmm. 

Jim Colassano: that's what these early wage access providers do. They say somebody may just need a little bit more money to get them through from one payday to the other.

They've already earned that money, but they may have to wait a week or two to actually get it paid out, and it's the early access to those wages. That is what the RTP network is enabling, and we're seeing a significant growth in that need because it really does satisfy an issue. People don't want to get the full amount of their paycheck when they may only need $50.

Joe Casali: [00:12:00] Right, right. Excellent. Second question I had, trying to remember my questions as I went. Second question I had was outta my head third question I had. What, for those folks, you know, uh, you, me, I don't want you to mention any customers or anything that you don't wanna mention, but you did mention early, getting an Uber and DoorDash getting paid out.

So let's assume they're using RTP. do you say to the. Community bank that says, well, the Ubers are taken, the, the PayPals are taken the, to all the everything's solved. what could we possibly offer to customer base as far as, I mean, 'cause I, I understand the power of the system just wondered, how do you answer that objection if you will.

Jim Colassano: Well, I, what I would say is don't look at the customer that we're talking about. Look at the application. What are they using it for? Businesses big and small have to pay their employees. So when you talk about [00:13:00] these early wage access capabilities, that's offered to a business no matter what size. Because employees have that same need, whether they're working for a large organization, whether they're working for an online organization or traditional small businesses, they have need for those types of services.

From a business standpoint, you're also seeing that businesses make refunds sometimes, right? They have to pay out customers. And in order to do that, one of the other areas that we're seeing a lot of growth in are refunds, customer complaints, that kind of thing. When you call up customer service, they're gonna send you a refund, but you might get it via a debit card.

You might get it via a check in the mail. 

Joe Casali: Mm-hmm. 

Jim Colassano: what we are finding is a lot of businesses nowadays are using RTP to close out that call to say, okay, I've taken care of this, I've settled it for you, and the money is now in your account by the time the customer hangs up the phone. And that in and of itself is creating a delightful experience.

So what you [00:14:00] are seeing, especially for smaller businesses, more technology savvy businesses, more technologically savvy individuals, 

Joe Casali: Mm-hmm. 

Jim Colassano: this is enabling technology and it doesn't matter the size of the business. Technology is enabling businesses large and small to take advantage of these faster, instant, innovative capabilities.

But you need to be able to actually move the money instantly in order to close the loop. So we have a lot of things happening out there that are quote unquote instant experiences. But the money movement typically lags if there's a, if that's associated with it, right? And this closes the loop so you actually wind up moving the money and creating a complete end-to-end experience.

That's real time. And again, that occurs for consumers. It occurs for businesses large and small. and the last point that I'll make is business to business transactions. It is something that has been re resistant [00:15:00] to moving away from paper. It is the one area where paper is still dominant. Checks are still dominant.

This is now allowing businesses large and small to move away from writing checks for supply chain payments or any type of business to business transaction and move those transactions over to electronic payments. which has been a desire for businesses for years. and those are the areas where we're starting to see traction.

And it doesn't matter the size of your company, the complexity of your company. These are basic needs that every business and every consumer have.

Joe Casali: I remembered my other question, with your jump to $10 million, I know there was probably surveys out there that said, well, if the, you know, if the limit was higher, businesses would use it, but not until you actually raise the limit. Do you actually find out, did you find out anything when the, limit raised?

Was there a, an adoption or volume?

Jim Colassano: We've actually seen a significant increase. so let me give you an [00:16:00] example. since we increased the limit in FE February 19th, I think we did it, we have seen our daily transaction totals rise, to, over 7 billion was the last number I saw. So we are seeing a very significant increase in the dollar value of transactions over in the network.

And we are setting new records almost weekly in terms of those dollar amounts. and that's all coming from large dollar transactions and new use cases by the way. what we are starting to see traditional business to business activity, we are seeing that liquidity management transfers between banks.

 organizations and businesses who need to manage the money they have in multiple accounts, and they're using these as a way of managing their cash across accounts that they own. This is unlocking a lot of those capabilities and we are seeing banks start to use it and customers start to use it in very innovative ways.

So yes, we have [00:17:00] definitely seen an uptick and that continues to grow on a, on an almost weekly basis.

Joe Casali: excellent. I have to struggle sometimes in these podcasts because I really become an audience member and not, a cohost here. Um. You mentioned something as you were going along that I'm,it just clicked for me, for a second. The technology used for RTP allows for innovation much faster than any traditional, sorry, question.

There's a question mark at the end of this. Does the technology used around RTP allow for faster, I want to say easier if you walked in. You as a business person, had an idea, you grabbed the program and said, I wanna solve this problem. used for that versus technology used for checks would seem to be a very easy, process to invo in installing a solution.

Yes.

Jim Colassano: So I would say that the [00:18:00] tools are there that didn't exist today.

Joe Casali: Mm-hmm.

Jim Colassano: So when we talk about, the real-time payment network, the instant payment networks, it's more than just speed. It is the transparency, it is the finality of the payment. It is the 24 by seven aspect of it. So when you're looking at problems that, organizations, banks, and businesses have tried to solve in the past, which bat with batch systems that take days to clear and settle, where funds aren't immediately settled, where they can be recalled, revoked for days, that really creates problems.

 and what this network does. It provides you with a tool set that allows you to go after those things that historically have just been exceptions that you've had to work after the fact and allows you to deal with them instantaneously and in a much more, um, comprehensive way. I'll, I, there was a, a quote that a business that a business gave me when we were doing a panel several years ago, [00:19:00] and I asked four business people on the panel.

What do you think about the payment process today? Forget about real time payments. What do you think about the payment process today? And one of them looked me in the eye and said, I will tell you the payment process works perfectly except when it doesn't.

Joe Casali: Great, great

Jim Colassano: He said, and when it doesn't, it's massively complicated screws things up greatly and is hard to recover from.

And so when I look at at real time payments, when I look at the RTP network, it allows me to take those things. That I could never solve for before and solve them now. So those are the, the kind of ways that we're looking, you know, that that, that we're looking to kind of introduce this into the market.

Not only can it be used on a large scale for distribution and for payroll, but it also allows you to deal with those things that are exceptions in the current payment environment and address them that are real pain points that can be [00:20:00] addressed in ways that checks couldn't address them in the past and the way that BAT systems couldn't address them in the past.

And the nice thing about it and how that ties to technology today, our FinTech firms are figuring out really, really innovative ways of creating end-to-end, elegant experiences that look real time. And then they drop a transaction out to settle over a batch network, right? you see card abandonment issues.

You see all of these issues that aggravate the heck outta everybody. Because you get to the last, you know, the last couple of inches and suddenly something goes wrong. And, and, and it's those technology providers that really want to use the network to be able to close out and create that end-to-end experience that really works.

And those tech providers are selling it to banks and corporations, big and small. And that's where those technology providers are really providing the engine for growth and leveraging the network.[00:21:00] 

Joe Casali: So I think I asked some great questions. I don't think I'm following my script at at all. Sorry. I always love asking this question. So back nine years ago when it was being conceptualized, what volume is gonna flow over the network? You guessed at something now, what's the latest? Oh, that volume is, is flowing over the network.

The last one I can tell you I was told is you didn't realize how many wealth management transactions were gonna go.

Jim Colassano: So, we made a couple of assumptions early on that proved wrong, both ways. 

Joe Casali: Hmm. 

Jim Colassano: The one thing that I do recall us having conversations on early on was payroll. We thought payroll was done and dusted. We thought direct deposit of payroll had pretty much cleaned up the process.

There was nothing we could do to improve it. 

Joe Casali: Mm-hmm. 

Jim Colassano: were completely wrong on that front.

Joe Casali: Wow.

Jim Colassano: are finding with the early wage access, with a gig economy, also [00:22:00] with traditional payrolls that are now also moving over to real time because you have those issues right now with people who get paid on the 15th and the 30th of the month, and then that happens to fall on Christmas weekend, the long Christmas weekend.

And suddenly you get paid on a Friday, but you don't get your money until Tuesday, right? So there are lots of issues that we thought were already done and resolved. That would never be an area that we would've to go into. And we are finding that that is one of our fastest growing areas. And I always think that it's amazing to me that at the end of the day, it always winds up coming back to payroll.

 it's how people get paid and how people make payments that really drives. You know, payment, activity and innovation in the marketplace. That is the one thing that has continued to surprise me. Started with gig economy, moved over to early wage access, and then just seeing the entire payroll cycle end to end, start to improve.

And by the way, it's not just paying employees, it's also [00:23:00] the receipt of money by employers that normally takes a couple of days to cycle through. 

Joe Casali: Mm-hmm. 

Jim Colassano: That's also being compressed. And improving the end-to-end cycle, so it's benefiting both employers as well as employees.

Joe Casali: I, you know, I love the stories, The first thing I love is that, and it's in there. I love that, that notice. but then the, oh, we, we went this way and it ended up that way. I love those stories. I have an association in my roots, so we try not to talk about money, but there are, I mean, all of these service. Services you do are premium services. There are revenue opportunities for any, any

Jim Colassano: All right.

Joe Casali: to, to actually make money for the payment service. I would not know how to talk about that. Can you say anything about that?

Jim Colassano: Sure. 

Joe Casali: 

Jim Colassano: what I will say is, you know, over 50 years, here's what happens to any capability. It gets commoditized, [00:24:00] right. if you take a look at the cost for any type of batch service that has big volumes, it's probably down in the ubstance, under, under a penny type of of transaction. because you're not really providing that much value on a transaction by transaction basis.

Joe Casali: Mm-hmm. 

Jim Colassano: When you look at all of the tools, all the capabilities that are involved with an instant payment, you can now target high pain points. You can now say that I can go after, I can eliminate your day two processes by moving you over to RTP. Businesses can take a look at that, put a number on that and say, okay, I can see how much value I'm getting out of it.

I know how much pain is involved with it, and I'm willing to pay a premium because I can clearly associate the cost that you're charging me to the pain point that you're addressing. Right. If I can eliminate calls to a call center, there is nobody, no business in the world that doesn't know exactly [00:25:00] how much it costs

Joe Casali: Yeah.

Jim Colassano: to, you know, to get a customer complaint and deal with it.

And the benefit that you get from reducing customer complaints, right? for payments that are unable, unable to be applied, you have to have somebody research those. Everybody knows what that costs. 

Joe Casali: Mm-hmm. 

Jim Colassano: So when you're targeting those areas that are high pain points for customers. And providing them with innovative services that can actually reduce costs that they have in their own environments.

Then you can start to to value based, to value price, these things, 

Joe Casali: 

Jim Colassano: and that's what we're seeing with a lot of businesses. It's the innovation that doesn't just revolve around speed, but revolves around those areas where there's certainty in the finality of the payment. The processing cycles can really reduce, pain points and costs.

And that's where businesses are saying, okay, I'm willing to pay a premium price because they can see the value 

Joe Casali: Mm-hmm. 

Jim Colassano: not just a more expensive a CH transaction. Right. The the last thing [00:26:00] I would just add to that, to kind put a fine point around it, is we're not just moving payments anymore, we're moving non-financial messages.

So you can also move a lot of information about that payment through the same rails and information adds even more value. To the service that you're providing. When you start to put all those pieces together and you look at every arrow in the quiver, you've got a lot of tools that you can use to help customers solve problems, and you can charge for those services.

Joe Casali: Mm-hmm. what would you say to someone that says, oh yeah, it's just, and I think you actually just said it, it's just a faster a CH.

Jim Colassano: I would, I would ask them to look at some of the capabilities and I would ask them to talk to, you know, talk to us at at TCH because we have eight years worth of experience talking to banks, talking to clients, talking to consumers about, you know, the value that goes along with all of this. [00:27:00] I, I constantly say in panelists that I speak with, that these are precision payments.

And I still hate the fact that we call it the RTP network because it means that people just look at it as an instant payment, the faster a CH, and there's so much more that's associated with it. And I will tell you, even from a consumer standpoint, consumers know the time value of a, of money. and I will say that once consumers see the value, similar to businesses.

They will be willing to pay a premium for money that moves instantaneously if that's what they need, right? So those are the areas where I think you add so much more value. But you've gotta take a look at the network in totality and understand that it's solving problems. It's not just displacing what's already out there.

And once you look at it that way, you'll see the revenue opportunities.

Joe Casali: of the interview questions I ask are things that I'm rethinking in my head [00:28:00] and, some of them aren't, but that, that was exactly, it isn't just a, a different, a CHA different check system. It is, 

Jim Colassano: It's a new payment rail. It, it's got a lot of capabilities and that's what we try and enfor. We try and reinforce with people, when they're looking at the side.

Joe Casali: how much do you think that's been realized so far? The messaging, the, extending it out? I get opinion. My, what I would say is it's just at the beginning, no one's really. Pushed it to its limit yet? Yes.

Jim Colassano: I would agree. and part of the issue is with, with any program like this, you don't realize what the benefits are until you start to use it. So the more penetration you get, 

Joe Casali: Mm-hmm. 

Jim Colassano: adoption you get. The more demand you'll have, the most interesting, statistic I can give you is the repeat usage is extraordinarily high.

So there, there is a challenge with getting customers to use it for the first time, 

Joe Casali: Mm-hmm. 

Jim Colassano: there is [00:29:00] absolutely no issue getting customers to use it a second, a third and a fourth time. 

Joe Casali: Mm-hmm. 

Jim Colassano: So part of our issue in the last couple of years is start to get core users. Start to get core applications. Just start to get people used to the experience of getting their money when they want it, of sending money when they want it, and then you'll see that demand curve get higher and higher.

And to be honest with you, that's what drives banks to make changes, right? Customers asking for it, customers demanding it, customer's expecting it, and that's that. I think we're only seeing the beginning of that. But we do see, we crossed a billion transaction threshold earlier this year. So we are getting to a point of scale.

We have 5 million consumers who send and receive payments every single month and almost 300,000 businesses who send transactions every month. So we have saturation at this point, and all we're trying to do right now is build on those use cases that we are seeing, operate on the network, rinse and repeat [00:30:00] with all of this stuff, and then absorb the newer transactions and the newer use cases that we see and evangelize around them with, organizations like yourself.

Joe Casali: Excellent. Yeah, I just, we had a webinar. It was a great webinar about. Uh, starting using what are we, where really are we on instant payments from a community bank perspective? And, my goal is just to say, look, you know, there are use cases out there that, that are working and, and people are adopting. you don't really have to invent it. Just say, that, that player with your player and you have a solution.

Jim Colassano: And you're exactly right. It's, it's not, it is transformational. But it doesn't require organizations and banks to completely upend everything that they're doing. These can be integrated into existing environments, and to be honest with you, many organizations are already going digital. [00:31:00] So they're already there.

Only they're using legacy systems to complete that last mile. So swapping out those legacy systems, introducing RTP. As an alternative really does complete that end-to-end experience for your customers, and once organizations realize that it's not a far leap from there to actually get them into the network.

Joe Casali: Excellent. I did, is there any question, generally my questions. is there any question, I didn't ask that other people are asking you or people are asking at conferences lately?

Jim Colassano: And I think you've, I think you've, you've covered a lot of the questions. the essence of the questions that we get, are really how do I get started and why? and I think that's really the issue. there's no. When we first started the network, we used to get that one question, which is, what is the killer use?

What is the killer use case? Like the killer app? 

Joe Casali: Yeah. 

Jim Colassano: What's the one use case that's gonna make my business [00:32:00] case? When I joined the RTP network and early on, we struggled to find that one use case, right? What we're finding now is that there are hundreds of use cases out there 

Joe Casali: Mm-hmm. 

Jim Colassano: because it solves so many problems, and it can be unique to every customer, to every bank, whether you are a wealth management bank.

Whether you're a consumer bank, whether you are a large corporate bank or a middle market bank, there are solutions that you could deploy and that's really the area where do I start? and every conversation we have with banks, we find loads of areas where they can start using RTP, even not for their customers.

Some banks are starting with internal applications, taking some of their inefficient internal processes. And starting by understanding before you sell it to the client, eating your dog food, I think is the term they used, 

Joe Casali: you, 

Jim Colassano: uh, using it themselves 

Joe Casali: yeah. 

Jim Colassano: to gather some efficiencies, gather some experiences, and then selling it to customers.

There are so many different ways for a bank to start, and I [00:33:00] recommend to everybody reach out to The Clearing House. We have a load of stories, information, background on where you should be looking and what you should be looking for to get started. I would encourage everybody, you know, the time to wait is gone.

You really do need to get in the game.

Joe Casali: Oh yeah. so I was gonna make up a game and make you play it. And you actually answered the question while, while we were just talking. So for the folks who are saying what are the use cases, what are the use cases I know, which are all, of course, why not? the non taxi driver, I want get paid.

Now,

Jim Colassano: Mm-hmm.

Joe Casali: of course. the gig economy. I wanna get paid Now, of course. wealth management. I need to move my money around and I'll, I'll even add in, what their name was, but I heard them at one of your conferences early on. wallet maybe. Or

Jim Colassano: Mm-hmm.

Joe Casali: Digit. Digit.

Jim Colassano: Mr. Wallace. 

Joe Casali: yeah, they were, they were a rainy day fund that if that rainy day was Saturday, [00:34:00] you couldn't have the money, they moved on. Of course. That makes sense. Using, using it internally as a test case. the, I was gonna ask what's the latest you're hearing, but all, no-brainers as far as what are the use cases that people are using today? Not that you could use, not that, you know, you don't have a unique solution. I always imagined the delivery guy would an iPad saying, oh, press the button. You know, I'll give you your stuff paid. Here's your stuff. I, that's what I always imagine. I haven't I heard it yet, but if you hear it, let me know.

Jim Colassano: Well, we actually designed very early on that exact use case. You, we talked, we talked a bit before about there any surprises. 

Joe Casali: Yeah. 

Jim Colassano: That was actually the use case we thought we were gonna get started with. So, you know, ev like I said, we, we thought we knew how the market was gonna take and drive. and we do see some areas that are trying to build out that use case.

Joe Casali: 

Jim Colassano: but there were other higher priority use [00:35:00] cases that they wanted to start with. And while it defunding and disbursement pay loan payouts for banks are all dumped by check today. 

Joe Casali: Mm-hmm.

Jim Colassano: we're also seeing a lot of interest in the mortgage space, mortgage settlement, and closing escrow funds. all of those things that require an immediate transfer of assets and money 

Joe Casali: Mm-hmm. 

Jim Colassano: with finality that can be done across the country and not worry about time zone problems and any of that, all of those are solved by the, by the RTP network.

Joe Casali: Mm-hmm. 

Jim Colassano: so, like I said, the, the solutions are as varied as the problems. and I try and get people away from, what is that killer use case? What should I start with? And ask them where are the problems? Where are the things in the payment space that don't work for you? And then we talk about how they might be able to leverage the network to solve those problems.

And typically when we walk out of the room, they're still talking about problems they can solve. and that, that encourages me. And that's where I think we'll start to see gruff.

Joe Casali: Excellent. Well, thank you [00:36:00] for joining me today. I always feel a little bit honored to be in your presence. I appreciate it. I, I do see you all over the country. speaking here, speaking there, I'm like, oh, Jim's gonna be there. any final words for the audience?

Jim Colassano: like I said, my, my closing comment for everybody on every panel is get in the game. the time to wait is done. and I would encourage them to listen to podcasts like this, Joe, to come to conferences, to talk to colleagues who have already implemented it. but the time to wait is, is definitely passed.

Joe Casali: Excellent. Alright. Thank you very much.

Jim Colassano: Thank you, Joe. 

​[00:37:00]