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Real-time payments are an exciting new opportunity for businesses to move money within seconds from the sending bank account to the receiving bank using the RTP® Network.

Real-time payments can solve for many use cases, benefiting businesses and consumers. Faster payments is something we all can understand. But knowing how the RTP® Network works requires looking at real-time payments as if they were instant messages. With every real-time payment comes notifications for both sides of the transaction at the sending financial institution and the receiving financial institution.

The RTP® Network is owned and operated by The Clearing House, which has established a set of rules that govern how Participants will interact with The Clearing House and with each other when sending transactions via the RTP® Network. This mutual agreement to a common set of rules is what allows for seamless transactions. In accordance with the RTP System Operating Rules, Participants (depository institutions, like a bank or credit union, that have an agreement with The Clearing House) send Payment Messages (instructions to pay a fixed amount of money) on behalf of their customers. The Participant who receives the funds on behalf of its customer then sends a Payment Acknowledgement to notify the sending Participant that the funds have been received.

Make sense?

While the rules make it easier for financial institutions to communicate about RTP®, they are complex for the rest of us. Plus, your bank has to be a participant in the RTP® Network to even accept or send a RTP® transaction.

Dwolla simplifies real-time payments for businesses. With our modern payment technology, switching transfer types from ACH to RTP is as easy as making 1 code change in your API request (assuming the account is RTP-eligible).

Use this glossary to understand the keywords used to describe real-time payments and the RTP® Network. Our definitions come from The Clearing House and its RTP® System Operating Rules. They have been slightly edited for simplicity.

A
B
C
D
E
F
G
H
I
J
K
L
M
N
O
P
Q
R
S
T
U
V
W
X
Y
Z

A

Account

An account held by a Participant for a Customer to or from which a payment is received or sent.

C

Customer

A sender, receiver or a person that initiates or receives a non-payment message.

F

Federal Banking Regulators

The Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, the Office of the Comptroller of the Currency, the Consumer Financial Protection Bureau and the National Credit Union Association.

M

Message Receiver

A Participant that receives a payment-related message subject to and in accordance with RTP Operating Rules and the RTP technical specifications.

Message Sender

A Participant that sends a payment-related message subject to and in accordance with RTP Operating Rules and the RTP technical specifications.

Message Specifications

The RTP Message Specifications defines the structure and content of each message type that is supported within the RTP® Network.

Learn More

N

Non-Payment Message

Messages that are transmitted between the RTP System and a Participant or (between participants) that are not a Payment Message or Payment Message Response.

P

Participant

A depository institution that has entered into a Participating Agreement and Indemnity with The Clearing House.

Participant Agreement and Indemnity

The agreement between a Participant and The Clearing House that sets forth the terms pursuant to which the Participant may access and use real-time payments.

Payment

A transfer of volume from a Sender to a Receiver through the RTP system pursuant to a Payment Message.

Payment-related Message

A message, other than a Payment Message or Payment Message Response, that is transmitted between Participants. This could be a Request for Payment, Request for Information, a Remittance Advice, Payment Acknowledgement or Request for Return of Funds.

Payment-related Message Response

A response to a Payment-related Message may be a Response to Request for Payment, a Response to Request for Information, or a Response to Request for Return of Funds.

Payment Acknowledgment

A payment-related Message that a Message Sender submits to the RTP System on behalf of the Receiver to acknowledge receipt of a payment from the Sender.

Payment Instruction

Sent by a Sender to a Sending Participant to cause the Receiving Participant to pay a fixed amount of money to the Receiver.

Payment Message

Submitted by a Sending Participant to the RTP System that when released, instructs the Receiving Participant to pay a fixed amount of money to the Receiver.

Payment Message Response

The message from the Receiving Participant to the RTP System in response to a Payment Message. Responses can include an “accept,” “accepting without posting” or “reject.”

R

Receiver

A customer of a Receiving Participant whose bank account is designated to receive a real-time payment.

Receiving Participant

The Participant that holds the Receiver’s Account and that receives a Payment Message.

Reconciliation Window

The defined time periods for tracking payment and funding activity for producing reconciliation reports at the close of the time period.

Remittance Advice

A Payment-related message that a Sending Participant submits to the RTP System that is associated with and provides additional information about a specific real-time payment.

Request for Information

A Payment-related Message that a Receiving Participant submits to the RTP System to request additional information in connection with a specific real-time payment.

Request for Payment

A Payment-related Message that a Message Sender submits to the RTP System requesting a RTP Payment from a Customer of a Message Receiver.

Request for Return of Funds

A Payment-related Message that a Sending Participant submits to the RTP System requesting return of funds related to a specific real-time payment.

RTP Day

The calendar day in which an RTP Payment is made, beginning at 12:00 a.m. and ending at 11:59:59 p.m. ET.

RTP or RTP System

The Real-Time Payment System, established and governed by The Clearing House.

S

Sender

The customer of a Sending Participant that sends a Payment Instruction to the Sending Participant.

Sending Participant

The Participant that holds the Sender’s Account and initiates an RTP Payment.

T

TCH

The Clearing House Payments Company L.L.C.