New organization looks to make payments faster for consumers and FIs.
A coalition of payments industry organizations, banks and one credit union have formed a new organization aimed at helping create a secure payments system with near-immediate funds availability.
The organization, called the U.S. Faster Payments Council (FPC), said in an announcement that it plans to focus on private-sector ways to address obstacles that inhibit the adoption of faster payments. Over the next two years, it plans to identify, develop and support best practices, support adoption of safety and security practices for faster payments, and develop an educational and awareness program about faster payments.
NACHA, Early Warning Services, Jack Henry & Associates, Mastercard, Visa, The Clearing House and JPMorgan Chase Bank are some of the FPC's 22 founding members and sponsors. Columbus, Ohio-based Corporate One Federal Credit Union, which has $3 billion in assets and about 800 members, is also one of those founding members.
"Many years ago, we saw kind of a changing evolution in the payment world," Corporate One President and CEO Melissa Ashley told CU Times. "We've been in the payments world for five decades and have been helping credit unions serve their members with payments. We really saw kind of the first new payment rail in 40 years coming to fruition. We thought it was important for Corporate One to be on the cutting edge of that."
Ashley also said she wants Corporate One to be part of the roadmap and rulemaking for that new rail.
"In addition, one of the ways that payments are going to be effectuated are on digital solutions — your phone, apps, those kinds of things — and so we think credit unions really need to have the right mobile applications to allow their members to access the rail. So we had an initiative within Corporate One to be involved in digital solutions," she added.
Building the system will require cooperation between public and private sectors, Ashley said.
"At Corporate One, we're also working with operators and the Federal Reserve to figure out how we can help the credit unions in the actual payment rail, and getting access to that," she said.
The FPC's formation is the latest chapter in a history that largely began when the Federal Reserve established the Faster Payments Task Force, Ashley said. The task force's goal was to make real-time payments available to all consumers by 2020. It created the Governance Framework Formation Team, which focused on building structure, decision-making and processes.
"All along this we've had folks on these teams working with the Federal Reserve on how to develop this new payments rail, and out of that Governance Framework Formation Team they've now created the Faster Payments Council," she explained.
"The Federal Reserve applauds this next step in the evolution of the U.S. payment system," Federal Reserve Executive Vice President and Faster Payments Strategy Leader Sean Rodriguez said in a press release. "We commend the GFFT's efforts to come together and embrace the need for a new organization that will help facilitate efforts to modernize our country's payments system and allow everyone – providers, consumers, businesses, and more – to benefit from faster payments."
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