1.6 Seconds: Switzerland’s Successful Start of Instant Payments

Instant payments were officially launched in Switzerland on 20 August 2024. The results have been positive, even by international standards. First, at the time of launch, more than 60 financial institutions were able to process incoming payments instantly, representing a cumulative market share of more than 95% of customer payments. By 2026, all other financial institutions will be able to process such payments. 

This “accessibility” is based on a requirement set by the Swiss National Bank in consultation with the payment industry. For a payment method to gain market acceptance, the payer must be able to assume that the beneficiary will accept their chosen payment method. In contrast to the SEPA area, this obligation has existed in Switzerland from the very  beginning. Unlike the EU, the Swiss financial center has refrained from setting requirements for the price of an instant payment. The Swiss National Bank and SIX, which offer this service, expect that in the medium term, even without regulatory pressure, this payment instrument will establish itself as a new standard in electronic payment transactions at competitive conditions. 

Second, SIX conducted a pilot phase and a friends-and-family phase prior to the official launch. The players involved in the ecosystem made intensive use of this time to gain experience and to identify and, where possible, eliminate any teething problems. A distinctive feature of the Swiss financial center was highlighted: the large volume of customer payments (such as those based on the QR-bill) that are already being processed via the RTGS system. The QR-bill enables highly standardized, end-to-end processes in invoicing and processing, some of which need to be adapted in the context of instant payments. It has become apparent that not all market participants have yet adapted their processes to be able to handle incoming payments not only correctly, but also at the speed expected by their customers. It can be assumed that the pressure on invoice issuers in particular will lead to these processes being optimized end to end, and that many others – depending on the actual business model, of course – will also be instant in the future.

As a result, about a month after the launch, the number of transactions is well above  expectations and in the four- to five-figure range per day. Here, too, there are differences to the EU: When SEPA instant payments were launched in November 2017, the participating payment service providers in the euro area covered around 1% of all SEPA payment transactions. In Switzerland, this coverage already exceeds 95%. While the average processing time in the SEPA area is generally less than 5 seconds, but can be up to 10 seconds in individual cases, the processing time measured by the Swiss core infrastructure for the fastest transaction is 1.6 seconds. This value, measured between payment initiation and execution confirmation, is already close to the maximum processing speed requirement for a POS payment. This is typically less than one second for optimal contactless payments.

Christopher Koch
Senior Project Manager, SIX