Bank of America Says Higher RTP Limit Enables New B2B Use Cases

Six weeks after The Clearing House raised the transaction limit on real-time payments from $1 million to $10 million Feb. 9, transactions over $1 million accounted for 52% of the value of all U.S. real-time payments processed on the RTP® network by Bank of America .

The bank’s clients have embraced the new, higher limit to enable new use cases in B2B payments, Bank of America said in a Tuesday (June 10) press release provided to PYMNTS.

“Our clients have been using RTP to pay vendors, employees and customers, but the larger cap has opened up use cases for different kinds of transactions, such as real estate and deal closings and other corporate activity,” AJ McCray , head of global payment products, Global Payment Solutions (GPS) at Bank of America, said in the release.

Bank of America, which is one of the owners of The Clearing House, is one of the first financial institutions to enable corporate clients to send payments up to the new $10 million transaction limit, according to the release.

With the RTP network, payments are settled immediately, the payment’s originator can see the status of the transaction, the recipient receives the payment within seconds, and, because RTP uses the ISO 20022 standard for financial messaging, the originator can include detailed remittance information with the payment, the release said.

The network operates 24 hours a day, seven days a week, per the release.

Other potential use cases for the RTP network include just-in-time supplier payments, complete real estate transactions and account-to-account money movement, the release said.

“The instant nature of real-time payments is a huge advantage for optimizing working capital and cash flow,” Jay Davenport , co-head of GPS global corporate sales at Bank of America, said in the release. “RTP payments embody some of the most commonly requested features from our customers — convenience, transparency and resiliency.”

Faster payments seek to offer immediacy, transparency and availability of funds that solve real-world frictions, Irfan Ahmad , managing director and head of U.S. payments in GPS at Bank of America, told PYMNTS in an interview posted in May.

“[N]o other payment rail allows you to see within a few seconds whether or not that payment was successful,” Ahmad said. “…There’s a huge benefit in that, whether you’re a consumer or a business.”

The Clearing House raised the transaction limit to $10 million Feb. 9, saying the change allows the real-time payment network to provide “a seamless alternative to traditional wire transfers and checks while improving liquidity management in today’s fast-paced economy.”

Over 285,000 businesses use the RTP rail monthly, a testament to the growing corporate demand for instant payments , according to the April edition of the PYMNTS Intelligence and The Clearing House collaboration, “ The Real-Time Payments World Map .”

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