Summer will bring more speed to payment transactions. The larger Swiss banks must be able to receive instant payments from August; all other banks will follow by the end of 2026. This means payments must be made within ten seconds, regardless of the time or day of the week.

This is called Instant Payment. The corresponding infrastructure for processing this form of payment was developed in Switzerland by SIX in collaboration with the National Bank.

Technically, everything is ready

«We have been ready since November 2023. Several tests have been successful,» SIX CEO Jos Dijsselhof told finews.ch.

So the question is: Are the banks ready too? According to SIX, in a first step, at least 50 banks covering approximately 98 percent of customer payments in Switzerland must be able to process payments in seconds by late summer.

Transition is in the interest of the banks

This is certainly in the interest of the institutions. Currently, payments between banks are settled or credited to the recipient within one to three business days. «Up to three days – that's a long time. A lot can happen in terms of security,» according to financial circles.

However, many institutions need to adjust their systems for the transition, and this will cost money. Among other things, transaction monitoring such as money laundering regulations must be guaranteed: Instant Payment also means compliance in real time. Banks will rely in particular on artificial intelligence, digital authentication methods, and biometric verification, in particular, to achieve this.

Stimulating the need on the customer side first

It is not quite clear whether there is also a need for instant payments on the customer side. According to banking circles, this may need to be created first.

First and foremost, digital banks or neo-banks are likely to do this in order to advertise their own services

Or it may be smaller institutions that take the lead, for example, Hypothekarbank Lenzburg. It will be one of the first banks, it will to introduce instant payments for its customers free of charge from summer onwards, thus putting pressure on other institutions in the competition for customers, as it announced recently.

It is likely to be similar to the end of last year when Zürcher Kantonalbank initiated a new round in the price battle by waiving annual fees for existing customers.

Not yet the new normal in Europe

Charges will be a key point in how quickly the new system will establish itself, as seen in Europe. Instant payments are possible in 30 countries across around 2,300 banks, which accounts for 63 percent of all institutions – albeit with significant differences between individual countries.

The share of instant payments, more precisely SEPA Instant Credit Transfer (SCT Inst), in relation to all conventional transfers (SCT), is over 17 percent – and rising. Nevertheless, instant payments have not yet become the standard. They are still a long way from the new normal.

This is due to the significant differences in transaction fees: Depending on the bank and the package used, such a payment costs between zero and two euros. However, high prices are not very appealing for using instant payments.

The European Parliament has responded to this by issuing a regulation in February stipulating that any fees incurred must not be higher than the fees for standard transfers. This will become legally effective from next year.