Why the U.S. has reached a real-time tipping point

The need for speed, convenience and certainty is driving demand for faster payment services in the U.S.

Same day Automated Clearing House (ACH) payments rose 19.1% year-over-year in the first quarter of 2025^[1]. FedNow is also reporting significant growth, with more than 1.3 million transactions settled in the same period[2]. Similarly, a record 98 million transactions were made through The Clearing House (TCH-RTP) network in Q4 2024^[3].

Nacha’s Smarter Faster Payments conference highlighted the progress that is now being made to expand use-cases and benefits. It also underscored why consolidation is more important than ever before for the banking industry.

The opportunities and implications of rising payment values and volumes

In recognition of the systemic importance of high-value payments, the U.S is taking steps to increase transfer limits. TCH went live with this change in February, enabling real-time payments up to the value of $10 million. In June, FedNow will increase its limit to $1 million.

The use of real-time and near real-time payment rails is also expanding. With the Federal Reserve proposing to make its service available 22 hours a day, seven days a week, Nacha is also considering adding a fourth processing cycle for same-day ACH.

While this is creating opportunities for banks – such as improving liquidity management, meeting demand for embedded finance, and expanding into new sectors – it is also a major operational shift. It requires that payments systems are robust and agile enough to support increasing values and volumes of faster payments, monitor for fraud and errors in real-time, and process transactions around the clock.

To extract more value from ISO 20022 data banks will need to consolidate

Alongside all of this, FedWire ISO 20022 implementation deadline is looming large in the minds of U.S banks. Yet while some are still grappling with compliance, others are now exploring how the new messaging format can be leveraged to better monetize payments data.

By creating a single, structured messaging format for payments processing globally, ISO 20022 removes the need to use individual flows and different payment solutions for different payment types. This enables more control over data, making it easier to extract value that can be used to enhance areas like fraud prevention and reconciliation that support embedded finance.

Successfully monetizing payments data, however, demands the ability to natively process new ISO 20022 format messages. With ISO 20022 soon to be the standard globally, an over-reliance on messaging translators means banks make it harder for themselves to reap the benefits of rich ISO 20022 data. If banks want to unlock the full benefits of richer data, they must adopt native ISO 20022 solutions as a priority.

Smart routing as a strategic tool to optimize payments processing

The challenge in responding to the rising value and volumes of payments is that separate systems for different payments methods are still being used, which makes it hard to route transactions efficiently. Additionally, while banks can start their payment transformation with a consolidated ISO 20022 payments solution, such a change will likely be gradual, meaning in the interim banks must find a way of improving the situation with existing payments engines.

As a result, interest in the use of smart routing is growing. When implemented as a strategic layer between customer-facing channels and backend payments engines, smart routing can help banks to automate transaction handling, routing different payment types to the best clearing and settlement method, or offering backup options if one method fails.

This enables the agility to respond faster to changing market and customer requirements, while gradually transforming the payments landscape within the bank.

New fraud monitoring rules require a proactive approach

Finally, as expected, real-time fraud prevention remains a key consideration. Reports show that a third of U.S. adults have fallen victim to real-time payment scams^[4].

To combat this, Nacha is introducing new real-time fraud monitoring for ACH transactions, which go live in March 2026. It is rumored that the Federal Reserve is planning to introduce a new “Service Directory”, which could improve transaction monitoring by providing a consolidated view of every customer and every participating bank on FedNow. In addition to mitigating fraud, this would also enable banks to compete with the likes of Venmo and PayPal in facilitating mobile, peer-to-peer (P2P) payments.

From our work helping banks to address regulatory requirements like Confirmation of Payee (CoP) in the UK and Verification of Payee (VoP) in Europe, we understand the significant system upgrades that new fraud rules mandate. This means it is critical to take a proactive approach. For instance, with Nacha’s new rules less than nine months away, banks should already be in the stages of vendor selection. Crucially, this should be a technology partner that can support from devising the payments technology strategy through to implementation and roll-out.

The future of payments processing

As real-time payments accelerate in the U.S and beyond, the ability to consolidate is becoming a key advantage. By choosing to work with a strategic technology partner rather than multiple third-party vendor solutions, banks can streamline complex payment estates into a single payment processing infrastructure. This will enable the agility, flexibility and resilience to not just respond to change, but to lead payments forward.

From planning through to implementation, Icon has extensive experience supporting banks to sustainably, progressively and transform their payment systems in response to changing requirements. Get in touch to discuss how we can help.

[1] https://www.nacha.org/news/ach-network-sees-strong-start-2025-volume-and-value-increases-both-standard-and-same-day-ach

[2] https://explore.fednow.org/explore-the-city?id=3&building=news-center&postId=82&postTitle=fednow-service-continues-momentum-in-q1-2025

[3] https://www.theclearinghouse.org/payment-systems/Articles/2025/01/RTP_2024_Year_Records_01-08-2025

[4] https://www.fico.com/en/latest-thinking/white-paper/fico-2024-global-scams-impact-survey