The Federal Reserve believes that the U.S. payment system is at a critical juncture in its evolution. The nature of commerce and end-user expectations for payment services is changing and unfortunately payment security and the protection of sensitive data is being threatened. Due to this, The Federal Reserve System released a paper outlining its next steps in developing a process to speed up electronic payments and settlements. Their goal is to continue to push toward a payments system that would offer greater speed, security, efficiency, cross-border options and stakeholder collaboration.
In order to meet their goals, the Fed plans to launch task forces on faster payments and payment security to give bankers and other payments industry stakeholders a more formal way to share input. Starting this year and continuing into 2016, the faster payments task force will lay out a policy framework for the new system and identify practical approaches for implementing it. Simultaneously, the payments security task force will develop appropriate security standards and expand the Fed’s anti-fraud and payments risk management offerings.
As part of the project, the regional Federal Reserve Banks will extend operating hours for the National Settlement Service in phases. Early this year, opening hours will be extended by an hour and a half each day, and by year’s end opening will correspond to the 9 p.m. opening of Fedwire on the previous date. The Fed said its longer-term goal is weekend or 24-hour service, and added that it would promote greater use of same-day ACH and expand its international payment services.
The Fed will hold a webinar on Thursday, Jan. 29, at 1 p.m. EST at which Fed Governor Jerome Powell and Kansas City Fed President Esther George will answer questions submitted by industry participants. Read the paper. Listen to the webinar and submit questions.