Dual-speed payments
When processing everyday payments, whether sending or receiving money, we are so used to instant transactions that it is easy to forget that this is a relatively new dimension to our finances.
Rewind thirty years, in the days before the internet as we know it, and standard clearance times were between three and five working days.
This is why cash was king, as it was the only way to guarantee a fast payment, but it was obviously unsuitable for anything other than in-person purchases.
What came before?
Before debit and credit cards, apart from cash, the only way to pay for goods or services was via a cheque, and for large transactions, a banker’s draft or even letters of credit were used. While these still exist today, they are no longer compulsory for international trade. Back in the day, they really were the only way.
A letter of credit is a contractual commitment by a foreign buyer’s bank to pay an agreed invoice once the exported goods are proven to have been shipped.
The correct documentation has to be presented as proof, and the letter of credit protects both parties. However, in this day and age, other than in extreme circumstances, they are unwieldy and unnecessary.
Cheques were another interesting form of payment. While a cheque could be written for any amount, waiting around for it to clear through the banking system made instant transactions almost impossible.
To get around this and speed things up, the banks introduced cheque guarantee cards, which were the precursor to debit cards.
However, at the time, they had a very different function. The cheque guarantee card did ‘exactly what it said on the label’ – it guaranteed that the cheque would be honored, allowing the vendor to hand over the goods to the customer, safe in the knowledge that the cheque would not ‘bounce’ – due to insufficient funds.
Getting around payment limits
However, there were limitations, and this is likely one of the early examples of how modern payment speeds affect payment sizes.
In order for the payment to be guaranteed, the purchaser handed over their cheque and the card. The vendor verified that the signature on the card matched the one on the cheque that had been written in front of them and then wrote the card number on the back of the cheque.
When they were first introduced in the UK in 1969, the limit was £30. This was increased to £50 in 1977 and later to £100 or £250 at the bank’s discretion.
Once verified, it was impossible to place a stop on a cheque, and the vendor knew they would be paid. In order to guarantee payment, many purchases were broken down into smaller invoices with lower-value cheques dated on different days to ensure payment. Unsurprisingly, by the 2000s, they were largely obsolete and phased out in 2011.
Faster payments and real-time payments
In 2025, most of us will rely on the internet for sending and receiving payments. However, the Faster Payments system, on which we are now so dependent, was only introduced in the UK in 2008, and Real-Time Payments were introduced to the US in 2017.
They are still in use today to enable payments to move securely and quickly between bank accounts 24 hours a day. Real-time payments are settled and cleared within seconds, which improves transparency and increases confidence in payments.
However, there are limits on the sums of money that can be transferred using Faster Payments, and in addition, some businesses have to initiate additional cheques before payments are released.
How are sectors affected by payment speeds?
A classic example of different payment speeds affecting payment sizes is the online casino industry. Obviously, this is a sector where security and trust are paramount. You only have to think about the levels of security a brick-and-mortar casino has to deploy to understand how much more complex this is for an online casino.
While online casino heists might not feature in blockbuster movies like Ocean’s Eleven or its remake starring Margot Robbie and Ryan Gosling, the logistics of security and payment speeds are even more complicated.
Online casino players in the US will often find that while a big win might be their dream, it is easier to withdraw a series of smaller wins from an online casino. In general, despite casinos calling themselves ‘instant withdrawal’, players still have to wait around for their winnings.
While the casino might instantly withdraw the winnings from the casino account to the player’s online account, it can take considerably longer for the money to be back in the player’s bank account or e-wallet.
How to ensure fast payouts?
Fortunately, expert reviewers at Casino.org find the fastest payouts and advise which payment methods payout at what speed and what the limits are.
They recommend that PayPal, Apple Pay, and debit cards usually pay within twenty-four hours. However, depending on the bank, withdrawals can be limited to a maximum of $5,000, although most are up to $25,000 in a day.
Most of us can only dream of withdrawing those kinds of winnings from an online casino and might be happy to wait a few extra hours or days to get our hands on the money.
Making the case for business
For businesses making significant payments to suppliers and contractors, Real-Time Payments also have an upper limit. While they are available in more than 70 countries across six continents, they have still been relatively slow to gain traction in the US.
However, the increase of the upper limit to $10 million is expected to mean that the country might see fewer transactions, but they will be of greater value.
