Real-Time Payment Networks: RTP and FedNow in Focus

Transfers are accelerating as banks connect to instant rails such as FedNow and the RTP network from The Clearing House, yet day-to-day consumer scenarios still rarely default to this option.

According to Darragh Buckley, founder and CEO of Increase, that shift is underway as financial-technology startups enter the payments arena and pursue more agile payment solutions delivered through API connections to banks.

Buckley notes he became Stripe’s first employee in 2010, shortly after John and Patrick Collison launched the company, and he left six years later to pursue his own fintech ambitions. In 2020, he started Increase, which provides software for bill pay, payroll, and loan servicing.

Increase now serves clients including the New York company Ramp, Stripe, and Gusto in San Francisco.

To date, he has bootstrapped the business, which has 30 employees and is headquartered in Bend, Oregon; he declined to share how much he has invested.

Raised in Limerick, Ireland, Buckley knew the Collison brothers growing up, and he and Patrick reconnected while both studied at MIT.

Editor’s Note: This interview was condensed and clarified.

A real-time payment is a payment that is initiated, cleared, and settled within seconds, with 24/7/365 availability, so funds move immediately (and with finality) between participating accounts.

A real-time payment system or network is the underlying infrastructure—operated by a central operator and connected to banks and financial institutions—that supports those seconds-level transfers and the related payment messaging.

In practice, real-time payments generally work as a credit-push flow: a payer authorizes a payment; the payer’s bank validates the request (including authentication, balance checks, and fraud controls) and submits it to the network; the network routes the message to the recipient’s bank and coordinates clearing; settlement completes within seconds; and the recipient’s bank makes funds available immediately, with confirmation messages flowing back to the sender.

When money moves instantly, the operational focus shifts from “processing later” to “verifying now,” because the window for recovery is measured in seconds.

That speed and always-on availability are key differences from ACH, which is typically processed in batches with settlement timing that can vary by bank and window, and is commonly used for recurring, planned transactions. Real-time rails are designed for immediate, message-confirmed transfers with rapid settlement and near-instant funds availability, which changes the fit for time-sensitive use cases.

ACH is built for scheduled throughput and predictable batching, while real-time rails are built for immediate confirmation and continuous availability.

Zelle is often experienced by consumers as “instant,” but it is best understood as a bank-to-bank consumer product and directory layer: depending on the participating banks, a transfer may post immediately, or it may be delayed and handled through other rails. For that reason, Zelle is not synonymous with a real-time payment rail that clears and settles within seconds, 24/7/365, in every case.

Benefits of real-time payments can include speed and convenience for end users, improved cash flow and faster posting for businesses, better payment visibility through immediate confirmations, and reduced risk of certain “payment failure” scenarios tied to delayed posting and exception-heavy processing.

Common real-time payment use cases include bill payments, payroll, peer-to-peer transfers, emergency disbursements, insurance payouts, merchant refunds, and supplier payments where confirmation and immediate availability matter.

FedNow is the Federal Reserve’s instant payments service, while the RTP network is operated by The Clearing House. Both are bank-to-bank, credit-push real-time payment options with continuous availability and message-based confirmations; both depend on bank participation for reach, and both offer features centered on faster settlement and richer payment messaging, with institutions choosing how they connect and what services they enable for customers.

For businesses that want to implement real-time payments, typical options include enabling the capability through an existing bank relationship, integrating via APIs offered by the bank or a fintech provider, and updating internal workflows for reconciliation, customer support, and fraud/operations monitoring to reflect the irrevocable, always-on nature of instant transfers.

That same finality can create challenges: fraud attempts can be more damaging when funds move immediately; mistaken payments may be harder to unwind; operational controls and monitoring need to run 24/7/365; and adoption can be slowed by uneven bank enablement and the work required to change customer behavior and back-office processes.

Payments Dive: What Was Your Role at Stripe?

Darragh Buckley: I built and led the group handling programmatic integrations with financial partners—initially our U.S. banking relationships and the card networks—bringing Visa and Mastercard online. Stripe did not use wires to pay out merchants; wires can be fast, broadly available, and inexpensive at scale, but their failure modes made them a poor fit for a dependable disbursement product.

Working on Wells Fargo connectivity, we would sometimes receive manual emails warning that a wire could not be delivered, and it is difficult to craft products you’re proud of when the backbone is an email-based exception process. That is not a knock on Wells Fargo; the tooling was designed for different users. The U.S. rails are strong and widespread—we just need to better expose the last mile.

What Is Top of Mind for Increase and the Direction of U.S. Banking Infrastructure?

The core plumbing in the U.S. is solid. What is missing is last‑mile delivery. We should broaden access to ACH through the Federal Reserve, along with FedNow, rather than invent a new rail. If I asked about your experience with RTP or FedNow, most people would say, “What is that?” The job is to surface what already exists.

Why Hasn’t Consumer Use Caught Up With Instant Payments?

New payment systems follow slow adoption arcs. Apple Pay is thriving now, yet its earliest growth looked unimpressive. Google has struggled in part because initiatives were ended before momentum could compound.

Eighteen months ago, activity on instant rails that move money within seconds was modest; today it is substantial. Coverage is not universal, but availability is spreading quickly and we will get there.

What Drives Adoption of Faster Payments?

• Recurring bills: present a “wait for a mailed check” option alongside a faster digital posting path.
• Wages: extend faster posting expectations into pay cycles once immediate posting becomes familiar.
• Instant credits: use small incentives to encourage faster acceptance and immediate posting.
• Replacing mailed checks: reduce reliance on paper workflows by making faster posting the default choice.

At a single bank, incentives may still tilt toward delays or high‑value wires, but once some institutions lean into immediate posting, competitive dynamics move the market fast.

When Will Instant Payments Become the Norm?

I would be surprised if it took as long as 18 months; I remain optimistic.