In early 2015, the Federal Reserve issued the Strategies for Improving the US Payment System paper that outlined the collective thinking of US payment system stakeholders and the Federal Reserve on desired outcomes for improving the US payment system.
The desired outcomes include improvements in speed, security, efficiency, cross border payments, and industry collaboration. This effort was the culmination of several years of collaboration between the Federal Reserve and industry stakeholders to set a vision for modernizing payments in the United States.
The Federal Reserve’s strategies paper called upon payment system stakeholders —including financial institutions, non-bank providers, businesses, retailers, consumer groups, standards bodies, and other organizations involved in making, receiving, and processing payments—to form two task forces: the Faster Payments Task Force (“task force”) and the Secure Payments Task Force.
These task forces, and the efforts leading up to their formation, leveraged a desire and a commitment among industry stakeholder groups to collaborate on a vision to achieve system-wide evolution.
The Faster Payments Task Force was convened by the Federal Reserve in May of 2015. The task force has focused its efforts on identifying goals and attributes of effective faster payment systems; proposing solutions and assessing their capability to achieve those goals; and championing the payment industry to take steps toward implementation and adoption of faster payments capabilities.
This month the faster payments task force published the first part of a report, describing its history and background, including the process undertaken to identify and assess faster payments pitches.
It will now complete its assessment of the proposals and develop recommendations and next steps for implementing safe, ubiquitous, faster payments, publishing the second part of its report in the middle of the year.
Meanwhile, the security task force will set out ways for the industry to improve payment identity management practices, provide guidance on standardising definitions of fraud and risk data so it can be easily interpreted and acted upon, and publish a framework for protecting sensitive payment data.
Esther George, president and CEO, Federal Reserve Bank of Kansas City, says: “The Fed’s priority is to advance improvements that are in the public interest so that consumers and businesses alike have access to efficient, real-time and highly secure payments in the United States.”
Download Report HERE