7th February 2025
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BoSS launches fast payment system to ease transactions across sectors

Author: Lasuba Memo | Published: February 4, 2025

Bank of South Sudan headquarters in Jebel, Juba. (Photo: Eye Radio).

The Bank of South Sudan has announced the establishment of National Instant Payment system to ease transactions between persons, financial and government institutions and businesses.

The financial regulator launched the initiative in collaboration with AfricaNenda, an independent African-led organization working toward accelerating expansion of inclusive instant payment systems across the continent.

According to an official statement seen by Eye Radio, the system is designed to enable real-time, secure, and cost-effective transactions to harmonize systems of the financial agencies operating in the country.

It said the transformative move to modernize financial infrastructures aligns with broader efforts to implement other critical infrastructures, such as Automated Clearing House and Real-Time Gross Settlement systems.

The statement added that, a road map is due to be developed to capacitate the country’s financial institutions in order to better manage the system.

The development is said to advance the Bank of South Sudan commitment to provide financial services to the citizens.

Excerpt from IR, a U. S Based digital service provider, providing real-time, fault-tolerant management for business-critical computer systems and applications, things have changed a bit explains how this system work

What is an instant payment?

These faster payments systems allow transfers to be processed directly between banks and financial organizations without the involvement of intermediaries such as clearing houses or correspondent banks. This means that transfers can be made very quickly and securely.

In this new era, consumers, businesses and payments stakeholders increasingly expect instant payments to be a standard feature offered by their banks and financial institutions. They’re demanding the facility to transfer and receive payments and to access money between bank accounts not only domestically, but internationally, in real time.

Those financial organizations who don’t offer instant payments, or those countries who lag behind with instant payment services can expect to lose valuable businessInstant payment systems enable consumers, businesses, and financial institutions to transfer money between bank accounts in near real-time. This means organizations can improve their liquidity and cash flow, as funds are transferred in seconds, rather than having to wait hours or even days for funds to clear.

Instant payments offer a faster, more affordable way to keep track of funds, obviously making funds available immediately, and streamlining the payment process.

Different instant payment methods

The terms instant payments and Real-Time Payments (RTP) are often thought to mean the same thing, but there are differences between the two.

Real time Payments (RTP)

In the US, RTP is one of two instant payment rails (the infrastructure that moves money from one party to another) that process instant payments. RTP is operated by the Automated Clearing House (ACH), a member organization owned by all the major US banks.

How do instant payments work?

While the process of executing instant payment transactions may look long and involved, the steps are fully automated and completed in a matter of seconds, with limited human involvement.

With recipients receiving funds immediately, the speed of this process makes instant payments a convenient option for a variety of financial transactions, including account-to-account payments, bill payments, and even eCommerce transactions.

  1. Payment initiation. The sender, who can be a merchant, business or individual initiates the payment transaction through a mobile application, online banking platform or possibly even in person.
  2. Payment information sent. The sender provides the relevant information such as recipient’s details, account number, amount or any other requested information.
  3. For payouts, the sender’s bank or financial institution validates the payment request, this includes verification of account balance and fraud checks. For payings, the receiving financial institution validates the request and obtains the payer’s approval to send payment.
  4. After the payment is authorized, it’s routed through the payment service, either FedNow or RTP.
  5. Notification. On the recipient’s end, their financial institution is notified of the payment request and validates it, then notifies the receiver of the pending transfer
  6. Funds Transfer. After checks are finalized, the funds are transferred from the sender’s bank account and delivered to the receiver’s bank account.

The features and benefits of instant payments

Instant payments offer a host of benefits for small businesses, large enterprises, individuals’ financial organizations and even for the global economy as a whole.

For example;

  • Outstanding bills and time sensitive payments can be settled more quickly, which improves liquidity.
  • Business partners benefit from faster payments, which makes collaborating easier and more streamlined.
  • There is far more transparency with instant payments regarding incoming and outgoing payments.
  • Faster payments also reduce the mechanics required to process payment transactions while still keeping transaction costs low.
  • As instant payments take only a few seconds, transactions no longer need to be manually checked or monitored.
  • Instant payments allow organizations to improve their cash flow, giving them more time to focus on their core business.
  • Banks and FIs can utilize instant payments to develop innovative financial services and strengthen their competitive position.

Recalling an instant payment

While there are a myriad benefit with the instant payment system, the downside is that they are difficult if not impossible to recall. While a standard bank transfer has to go through the clearing process, allowing time to make corrections or recall the transaction, an instant payment is set up so that the money reaches the recipient’s bank account within seconds, making it complicated to retrieve the money.

For this reason, senders should always ensure that the recipient’s details such as IBAN, name and account number are checked and correct.

In the last few years, most financial institutions across the globe have adopted instant payments solutions, and the number is rising exponentially.

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