“In financial transactions, time has become the currency of progress,” says Nick Chandi, CEO of ForwardAI, as he reflected on the power of instant payment systems. This trend is propelled by the demand for immediate settlement of transactions, offering businesses a competitive edge and efficiency.
As the financial world embraces digitization, the shift towards real-time payments signifies more than technological advancement; it marks a cultural transition in monetary interactions. Statistics from 2023 indicate that real-time payments are increasingly becoming the backbone of modern commerce, especially in retail and eCommerce.
Forwardly, the cutting-edge B2B payment solution developed by ForwardAI has emerged as a critical player in this revolution. Chandi, a mentor, Forbes Council member, and co-chair of the BC Tech CEO Scale C-Council oversees all levels of Forwardly’s processes, using his years of experience in technology and business management to make sure businesses seamlessly integrate fintech into their companies.
The company’s innovative approach to business instant payments has positioned it at the forefront of this transformation, reshaping the landscape of financial transactions. “The move to real-time payments is a leap towards a future where seamless financial transaction is not a luxury but a standard business practice,” says Chandi.
The Mechanics of Real-Time Payments (RTP)
The advent of RTP and FedNow marks a significant milestone in the financial sector’s traditional monetary transactions. At their core, they are systems that enable the instant transfer and settlement of funds. This innovation transcends the conventional time barriers associated with banking operations, such as the processing delays commonly seen in Automated Clearing House (ACH) transactions or wire transfers.
Chandi explains that real-time payments operate on advanced technological frameworks that facilitate immediate communication between banking institutions. When a transaction is initiated, the system instantly verifies the availability of funds, processes the transaction, and updates the sender and receiver accounts. This process occurs in seconds, contrasting traditional methods that could take several days.
The US Fintech Awards Judge explains that the rise of RTP/FedNow stems from the growing demand for speed and convenience in financial transactions, driven by the fast-paced digital economy. Consumers and businesses, accustomed to the immediacy of digital communications, now expect similar responsiveness in their economic interactions.
The Partner of Small Business
Traditional payment methods often involve delays that can strain the cash reserves of small businesses. RTP/FedNow eliminates these delays, ensuring that funds are available almost immediately, which is particularly crucial for small businesses operating with slim margins or those relying on quick inventory turnover.
For businesses, especially small and medium-sized enterprises (SMEs), the ability to receive payments instantly can significantly improve their cash flow, a critical factor for operational stability and growth.
Chandi explains, “Knowing exactly when funds are received allows for more accurate forecasting and budgeting, enabling business owners to make more informed decisions regarding investments, inventory management, and growth strategies.”
Leading the Charge in RTP and FedNow
With over 99.9% of businesses across the US being small, having robust instant payments becomes critical. Chandi’s Forwardly steps in with a solution specifically designed to bolster the financial operations of these small businesses. According to Chandi, Forwardly’s approach to RTP/FedNow is not just about speed; it’s about fundamentally enhancing cash flow management, a vital component for SMEs.
Forwardly’s instant payment systems ensure that businesses get paid faster and more efficiently, with reduced processing fees of up to 80% and free same-day Automated Clearing House (ACH) transactions. These features represent substantial savings for small business owners so they can allocate their resources more effectively and invest in areas that can spur growth.
For Chandi, Forwardly has become a comprehensive financial tool that empowers small businesses to focus on their core activities. With the burden of payment processing and financial due diligence efficiently managed by Forwardly, business owners can channel their efforts into growth and development, confident in the platform’s capability to handle their financial operations seamlessly and economically.
Forwardly’s US market penetration is a significant leap as the country has been relatively slow compared to other countries due to its entrenched reliance on established systems like ACH and Fedwire.
More Than a Technological Breakthrough
Despite the clear advantages of RTP/FedNow, the path to fully integrating this system is fraught with obstacles. Traditional financial institutions and small businesses are often entangled in the complexities of updating their legacy systems, which can be both challenging and resource-intensive. This struggle to adapt to the new RTP/FedNow standards may lead to frustration and skepticism, raising the possibility of a revert to conventional payment methods.
This situation poses a unique challenge to fintech leaders like Chandi to acknowledge that the transition to RTP/FedNow involves more than just deploying new technology but also involves transforming the collective mindset of the financial sector.
However, as businesses stand in the modern era of financial transactions, instant payments become a cornerstone of immediacy and transparency. Chandi’s Forwardly will embrace and lead the charge in this period of fintech, guiding businesses toward a more efficient, transparent, and inclusive financial future.