Switzerland Launches Instant Payments to Catch Up with Europe

Swiss consumers and businesses can now make instant electronic invoice and payments pushing for further advancements in the European financial landscape.

This new capability allows credit transfers to be completed within 10 seconds, an improvement over the traditional several-day waiting period. With this development, Switzerland is aligning with other European financial centers where instant payments have already gained popularity.

Transfers for Modernized Economy

Real-time payments have been available in Europe since 2017 and more recently in the US, offering a strong alternative to traditional banking transactions.

This method, which completes transactions in seconds, is quickly becoming standard practice across Europe.

According to the European Central Bank, the use of instant payments has skyrocketed from 5.2% of all credit transfers as of October 2019 to 17.8% as of February 2024.

Over 95% of all retail transactions between consumers and businesses In Switzerland, involving 60 Swiss financial institutions, can now be processed through instant payments. The Swiss National Bank (SNB), in partnership with financial systems provider SIX, has been leading the development.

 According to SNB, all financial institutions in Switzerland are expected to start offering the instant payment service by the end of 2026, and therefore the entire country will be using the fast mode of carrying out transactions.

“This market launch represents a further important milestone and reflects the collective stakeholder commitment to the future of cashless payments in Switzerland,” SNB said, accentuating the significance of this development.

Benefits Beyond Speed

It’s not all about speed when instant electronic invoice and payment comes to Switzerland, it’s also about lowering settlement risk, and  these types of payments are immediate and final, allowing both parties to update account balances on a real-time basis.

This alone should serve to simplify financial planning and budgeting for business and consumers and make the management of finances easier.

Faster money movement, however, might have broader implications for the economy at large. That would mean companies can reinvest their earnings much faster to fuel more economic growth and development.

Even though the adoption of instant electronic invoice and payment is on a perpetual rise, traditional payment methods, including physical money, are still popular in Switzerland. According to the survey data published by the central bank, at the beginning of this year, companies that have physical points of sale most often still accept cash as a means of payment.

The central bank, though, expects instant payments to become an obtained standard option within the medium term, gradually integrated into normal financial practices performed by Swiss consumers and businesses daily.

Switzerland is ready to embrace new payment technologies, with the country actively projecting modern financial practices growth to position itself in the lead, thereby ensuring a competitive upward-moving economy that stays closely connected with the rest of the world.

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