What is one primary benefit of instant payments compared to traditional RTGS systems?

One primary benefit of instant payments compared to traditional Real-Time Gross Settlement (RTGS) systems is that they generally cost less to process. Instant payments often utilize more efficient technology and infrastructure that facilitate quick transactions, which can lead to lower operational costs for the financial institutions involved. This efficiency can be attributed to the automation and digitalization of the processes, which reduces the need for manual intervention and lower reconciliation times.

In contrast, traditional RTGS systems may involve higher costs due to their wholesale nature, where each transaction is processed individually and requires significant liquidity management. By lowering the costs associated with transactions, instant payments can be more accessible to both businesses and consumers, promoting greater participation in the payment ecosystem.