Instant Payments Revolutionize Money Transfers in the Czech Republic, While Some Banks Lag Behind

In the Czech Republic, the financial landscape has witnessed a groundbreaking transformation with the advent of instant payment services. For over four years, clients have enjoyed the convenience of transferring money between banks in mere seconds, revolutionizing the traditional payment process. While almost all major banks have embraced this cutting-edge service, two notable institutions, UniCredit Bank and Max Bank, are yet to catch up with the trend.

Air Bank and Česká spořitelna took the lead in February 2019 by pioneering instant payments, quickly followed by the gradual inclusion of other banks on the list. Despite the swift integration by most players in the market, UniCredit Bank is still working on implementing instant payments, citing technical dependencies on other ongoing digital projects.

The delay in Max Bank’s adoption of instant payments can be attributed to the bank’s recent change of ownership, impacting their implementation plans. The bank’s spokesperson, Anna Bakošová, reveals that they anticipate introducing instant payments by mid-2024. However, recent reports suggest that Max Bank may merge with Bank Creditas, a bank already offering instant payments, in the latter half of the following year.

It’s worth noting that building savings banks are currently not participants in the instant payment scheme. Consequently, individuals seeking to send money to their building savings accounts beyond regular deposits have to resort to standard payments.

In essence, instant payments are one-time, domestic transactions that can be easily executed through Internet or mobile banking. When the recipient’s bank supports this service, the payment is instantly credited to their account, distinguishing it from standard payments that are subject to regular processing times. Importantly, banks do not impose any special fees for instant payments, making them an attractive option for customers.

However, for those who require an even faster option, express payments are available. These are fast payments to recipients’ accounts in other banks, typically processed on working days before a specific cut-off time. Express payments come with a fee, usually amounting to hundreds of crowns.

Despite the convenience of instant payments, their availability is contingent on both the payer and the recipient banks supporting the service. Furthermore, while they operate 24/7, they are not guaranteed, as technical issues at either bank during the transaction can revert the payment to a standard outbound payment.

To streamline the process, clients have the flexibility to choose between instant and standard payments when initiating transactions. However, it’s essential to confirm whether the recipient bank supports instant payments before selecting this option. Certain banks set specific limits for instant payments, varying from CZK 400,000 to CZK 2.5 million, depending on the institution.

As the Czech Republic continues to embrace instant payments, it significantly simplifies money transfers, offering customers enhanced convenience and efficiency. Nevertheless, the participation of all major banks is crucial for the widespread adoption of this revolutionary payment method. With this advancement, individuals and businesses can experience seamless financial transactions, further contributing to the nation’s digital economy growth.

Article by Prague Forum

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