Instant payments have already become the norm in the Netherlands. With the publication of the Regulation on Instant Payments (IPR) on March 19, 2024, this positive trend is set to expand across Europe. Since January 9th, banks in the SEPA zone subject to the IPR must be able to receive Instant Payments, and by October 9, 2025, they must be capable of sending them. Additionally, from October 9, 2025, they will need to offer a verification service, also known as the Verification of Payee (VOP), to ensure the payee's name corresponds with the provided IBAN number.
The IPR does not only force banks to become instant, but it also brings changes to existing flows of banks already supporting instant payments. Besides the obligation of VOP, for example, it will become mandatory for the originator bank to immediately inform the customer of an unsuccessful AND successful instant payment. Also, the bank should not independently alter a payment order from one type of credit transfer to another (e.g. from instant payment to “classic” SEPA credit transfer), as this does not align with the customer’s original choice.
With this approaching deadline, Projective Group conducted research aimed at outlining the current ‘state of play’ for SEPA instant payments in banking apps. The research was conducted among popular retail banks in the Netherlands (7), Belgium (7), France (2), Germany (1) and the UK (1). Two aspects were examined:
- Operational excellence - How are banks responding to unhappy flows and helping customers to complete what they started, i.e. a payment?
- User experience (UX) – How transparent is it for a customer that a payment went out as ‘Instant payment’ and how am I informed about the status of it?
By conducting four different instant transactions - the “happy flow” (a successful instant payment) and three “unhappy flow” scenarios (transaction to a non-existing, closed and functionally not accepted IBAN) we looked at the experience in the related banking apps
Banks vary significantly in the implementation of instant payments
Before going into the details, we can already share that banks vary significantly in the implementation of instant payments. Some banks place a higher priority on user experience, helping account holders better understand the status of their payments. However, the handling of unhappy instant payment flows seems to be organized suboptimally, sometimes even leading to confusion for clients. Additionally, the intelligence to guide account holders on the 'next best actions' after a rejected payment is still quite limited.
Based on our internal evaluation criteria, we identified the top performing banks*. In general, Revolut stands out by processing the instant payment in the best manner, offering a fast, transparent, and clear user experience. ING (NL)best assists the customer through unhappy instant payment and retrieves the highest score for Operational Excellence. Belfius scores the highest in User Experience by giving the customer an original experience.
Happy flow – best practices and challenges
Can you deduce that it is an instant payment when creating a transaction? Many Belgian, German and French banks, unlike Dutch banks, give customers a choice between Instant and a classic SEPA Credit Transfer (SCT). Whether this is a conscious choice or still linked to the fact that in earlier days the instant payment was positioned as ‘premium’ product in those countries still needs to be seen. Other banks do not mention it explicitly but indicate that a payment will go out as instant payment by stating during initiation that it is processed ‘immediately’ (ING NL, Rabobank, ABN AMRO, Knab, ASN) instead of ‘within 1 day’ for classic SCT.
Best practices to confirm a successful instant payment include using direct toast messages, as seen with Revolut and N26. Many banks still only mention that a payment is ‘send’ not saying anything in addition to the status of execution. Belfius confirms a successful instant payment with a clear message and matching picture in a separate screen. ABN Amro and Rabobank do well by displaying the execution and receipt times in time stamps (although you have to look for it).
Traceable information in the transaction overview makes the customer experience complete. Knab and Bunq indicate an instant payment by adding a lightning symbol and a transaction type description being ‘Instant payment’. At ING NL and Triodos it is not clear whether the transaction has been processed as Instant in the transaction overview.
Clear guidance in the unhappy flow is not yet the standard
The methods for notifying customers about an unsuccessful instant payment vary from immediate and clear notifications to more subtle or indirect approaches. Revolut, N26, Belfius and BNPPF BE give either a direct toast message or a strike-through transaction, which is considered best practice. Some banks only indicate the rejection through an additional credit transaction (ABN AMRO and BPRP-BPCE FR), sometimes combined with a message in the ‘inbox’ (ING NL). At Rabobank, we see different variations: A credit booking but also a strike-through transaction, which suggests that they are still looking for uniformity in the way they guide the customer through an unhappy instant payment. At Knab and Triodos, nothing happens in the app: The transaction is reserved but not booked. The debit or credit posting is not shown in the transaction overview, making it appear as if the transaction never took place. Triodos does send an email (not in app or a reject). At Bunq, the money is only returned after 3 days which indicates a poor operational process.
The reason for a rejection is not always indicated either. Best practices include providing a specific reason for the rejection based on the error code received, such as "account number incorrect” for ISO error code AC01, which can be shown both as an alert and as a more elaborate message (ING NL). ASN, Bunq, Triodos and Knab don't give any reason at all, which will increases the likelihood of customer dissatisfcation due to repeated failed attempts.
ING, Belfius and Rabobank succeed in providing specific advice when it comes to resending an instant payment in an unhappy scenario. Some banks offer specific advice and present concrete options, such as resending the payment as a regular credit transfer (N26, ING NL). ABN Amro and Rabobank (sometimes) automatically reroute to a classic SCT: A service that might be appreciated but sometimes also has the same result (reject), making it very confusing for a customer. Interestingly, this automatic rerouting is not allowed anymore under IPR starting October. There are a number of banks, like ASN, Bunq, Knab, Argenta, KBC, BNPPF BE, and BPRP-BPCE, that do not provide any advice at all. There is room for improvement here!
VOP (Verification of Payee): User friendly but limited to NL-accounts
Most NL-based banks already offer VOP, which will become mandatory from October 2025. This feature is generally user-friendly, with intuitive color coding, as seen at, for example, Rabobank. However, it is currently available only for NL accounts. For non-NL accounts, an "unable to verify" message appears. VOP ideally warns users about closed and/or invalid accounts. (Recognizing a ‘closed’ account is only successful at some banks that offer VOP.) Further, it is important to realize that VOP does not block the transaction from proceeding.
Making or giving the choice for Instant?
Article 5a(1) of the Instant Payments Regulation (IPR) states that PSPs that offer their Payment Service Users (PSUs) a payment service of sending and receiving (classic SEPA) credit transfers must also offer a payment service of sending and receiving instant credit transfers. Whether this means that instant is the new default or if a customer should have the option to choose instant payments is an interesting choice. At this moment, customers have the choice between instant or a classic SCT at N26, Belfius, Revolut, and Argenta. However, the question is whether the customer will be happy to make this choice for every transaction. A best practice (not seen yet) would be to offer the customer the option to set the default choice (‘toggle ON’) for all transactions, allowing them to switch to a classic SCT at any time if they don’t feel comfortable with Instant payments (e.g. fraud risk). This can save time and prevent confusion for customers who are not familiar with the difference.
What happens when the beneficiary bank is unavailable for instant payments?
When the beneficiary bank's instant payment service is not available, banks have different approaches to handling the situation. In some cases (ABN AMRO, Rabobank), the payment is held until the beneficiary bank becomes available again. An alternative approach would be to provide the client with additional options, such as resending the payment as a classic SEPA transaction or simply cancelling the payment. Communication between banks regarding (non)availability is often arranged through platforms like CONNECT in the Netherlands. The advice to banks is to connect and use these platforms to provide customers with a good alternative in case of unavailability.
Get ready for October
While some banks excel in transparency and immediate notifications, others lack clear guidance, especially in handling unsuccessful payments. Best practices include direct toast messages and detailed audit trails. Many banks still need to improve their customer communication and guidance in both happy and unhappy payment flows. Banks can distinguish themselves in this area and improvements can still be made to achieve better customer experience and better processing excellence by October.
Since the rules will change, we plan the same research in October once again focusing on two questions:
- Have banks improved in User experience and/or Operational excellence?
- What changes have banks introduced due to the IPR and are they compliant with it?
We are looking forward to this research already!
*This research was conducted in Feb-Mar 2025 period
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