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May 2017 Faster Payments Executive Summary: Faster Payments Gaining Traction

By Joe Casali AAP, APRP posted 05-03-2017 07:57

  

Faster payments are accelerating and show no signs of slowing down. From preparations for SDA Phases 2 and 3 implementations to blockchain-chain solutions for faster cross-border payments, everything on the faster payments front is full steam ahead. 

NACHA continues to prepare for the implementation of Phase 2 of Same Day ACH, recently releasing a series of checklists and guidance for ODFIs, RDFIs, Corporates, and Processors. With less than four months until Phase 2 implementation on September 15, 2017, you can expect to see an ongoing stream of resources from NACHA designed to help the industry prepare. And with the implementation of Phase 3 less than a year away, watch, too, for Phase 3 resources as they are begin to trickle in.

In other news, The Clearing House (TCH) and FIS recently announced the launch of a hosted Real-Time Payments Incubator service for early-adopter financial institutions in the United States. Also of note, DH Corporation made the news with its announcement of the availability for industry testing of its U.S. real-time payments processing solution, which will enable U.S. banks to begin testing for The Clearing Houses’ real-time clearing and settlement network.

The Fed is also gaining ground and expects to release the second report of the Federal Reserve Task Force mid-year. In related news, SWIFT reached an agreement with the Federal Reserve Banks and The Clearing House in support of standardized market practice to support end-to-end wire transfer, allowing them to move forward, pursing the goal of global payment innovation (gpi), which offers faster, more transparent cross-border payments.

And that’s not all.

Ripple, a block-chain payments and settlement provider added 10 new financial institutions to its network, raising the total to more than 75 participating financial institutions. As reported by PYMNTS.com on April 27, 2017, “Ripple’s solutions enable financial institutions to lower settlement costs by enabling direct, real-time transactions.” The article also points out that the addition of these FIs to Ripple’s network reflects increasing interest and continued growth around the capabilities that block-chain can provide within the broader financial industry.

Opportunities inherent in faster payments are giving rise to increased industry innovation. Recently, financial technology and solutions provider DH Corporation announced it is joining forces with Federal One Credit Union to enable real-time payments between credit unions. Early testing suggests that real-time payments across member credit unions will enhance efficiency and potentially help in drawing and retaining new members. 

NEACH will continue to help members stay informed about Same Day ACH rules changes and the opportunities and challenges of faster payments. In May, NEACH will host its 2017 Payments Management Conference, which focuses on educating its members about how operations will change as a result of new ACH rules and emerging industry trends. Register online today.

To view the Faster Payments Executive Summary in a chart format, click here.
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