The Federal Reserve announced last month that it would build a real-time payment platform to be launched in three or four years. The Fed was compelled to do so at the insistence of smaller financial institutions who were less than excited about buying real-time payment services from The Clearing House (TCH), which is currently the only other real-time payments network that serves all channels.
TCH is owned by some of the largest U.S. banks who compete with community banks for customers and banking services. In the Fed’s document titled: Federal Reserve Actions to Support Interbank Settlement of Faster Payments, the Fed makes the argument that with only one other real-time solution available at this time, and no other private provider coming forth with a solution that meets (or closely meets) the industry’s endorsed feature set, then the Fed needs to supply an alternative.