93% of Truck Drivers Would Use Instant Payments If Available

In an industry where every second counts, the transportation sector thrives on swift movement and seamless operations. But when it comes to managing financial transactions, many businesses in this space rely on outdated processes that can hinder overall efficiency.

A PYMNTS Intelligence report, “Moving Faster Than Ever: Real-Time Payments in the Transportation Industry,” a collaboration with The Clearing House, explores the disconnect between the industry’s fast-paced operations and its outdated payment systems, revealing a barrier to growth and profitability.

The Continued Use of Traditional Payment Methods

Although digital technology is impacting much of the transportation sector, traditional payment methods like paper checks remain prevalent. According to the report, checks account for 57% of total payment volume in the transportation industry, while automated clearing house (ACH) payments and credit cards follow at 51% and 50%, respectively.

This reliance on outdated infrastructure leads to several operational issues. The slow pace of check processing ties up cash flow, introduces errors, and increases operational costs. For truck drivers, cashing checks can be a time-consuming inconvenience, especially when they are working far from banking facilities. Additionally, checks carry security risks, such as theft or fraud, and their manual processing increases the likelihood of mistakes and delays.

Barriers to Real-Time Payments Adoption

Despite the advantages of real-time payments, their adoption in the transportation industry has been slow compared to other sectors. Several factors contribute to this delay.

First, many businesses, especially smaller ones, lack the technological infrastructure or financial resources to switch to modern payment systems. Concerns about security and the risk of fraud also make companies hesitant to embrace real-time payment methods. Additionally, many businesses aren’t aware of the benefits or available options.

For example, 24% of small and medium-sized businesses (SMBs) in transportation that don’t use digital payments cite the lack of offerings from their banks as a reason. Meanwhile, 29% of SMBs that haven’t used instant payments in the past year point to the complexity or lack of knowledge as major barriers. Cost is another issue, with 23% of businesses seeing instant payments as too expensive, while 22% report limited payee acceptance.

Real-Time Payments Offer Key Advantages

Moving to real-time payments offers the transportation sector many benefits. By eliminating the delays associated with check processing, businesses can improve cash flow, reduce costs, and enhance customer satisfaction. Real-time payments also improve financial processes like payroll and invoicing, increasing overall efficiency and accuracy.

For truck drivers, real-time payments offer a more convenient, secure way to receive compensation. Instead of relying on checks, which can be time-consuming and inconvenient to cash, drivers would have immediate access to their earnings. This could reduce stress and improve financial well-being.

Consider 93% of truck drivers say they would use instant payments if given the option. Those who already receive real-time payments highlight benefits like speed, security, and guaranteed funds. However, despite the demand, only 40% of truckers currently have access to instant payment systems.

Collaboration among financial institutions, technology providers, and government entities is key to unlocking the potential of real-time payments in the transportation sector. By offering user-friendly solutions, creating seamless integration tools, and implementing supportive policies, these stakeholders can drive adoption, improve efficiency, and increase growth in the industry.