….the Reserve Bank of Australia pushes Australian banks to create the New Payments Platform, a new piece of open-source infrastructure being built that will move the payments system to real time. The RBA’s plans are echoed by the US and the eurozone, which are also planning to roll out real time payment infrastructure by next year. These payments would boost Australia’s economic activity, as money flow improves and Australians access their funds as they are deposited, [Don Sharp at InPayTech] argued.
Australian banks could lose $2.5 billion in interest earnings if instantaneous payments were adopted – and the figure could jump significantly as interest rates rise.
Payments held in the banking system are part of the “float” which banks use for interest-free funding of part of their balance sheet — a boost to interest margins. Switch to a realtime payments system would see this disappear.