Faster Payments: Federal Reserve Driving Innovation
Fostering innovation of the U.S. payments systems has been in the news lately with the establishment of the Faster Payments Council on November 13th and the Federal Reserve seeking comment on potential actions that they could take to support faster payments, due December 14th.
Bankers’ Bank has been actively involved in the efforts over the past several years with industry efforts to move the needle on enhancing payment delivery. As such we are a Founding Member of the Faster Payments Council and will be providing comment to the Federal Reserve on views we support around a Real Time Gross Settlement Service (RTGS) and a Liquidity Management Tool (LMT) and their role in developing them in support of a resilient, secure, flexible, faster payment system.
Our primary effort in providing comment is to speak to ensuring that whatever effort is undertaken that there is an entry point for community banks. As the bedrock of financial services in most communities across the U.S. community banks play a critical role in the success of any solution. Without community banks the goal of access for all to a new or enhanced solution will not be met.
As we craft our comments we are seeking your input. In many ways we believe that what the Federal Reserve has proposed is too narrow. We believe they need to address what type of operator role they will play, whether they will be a driver of directory services, whether the National Settlement Service will be enhanced, these are in addition to the questions around RTGS and a LMT.
We are seeking any input you would like to provide us as we work on a comment letter. Please take a moment, review the Federal Reserve’s Press Release, and provide us commentary on your thoughts around the role that community banks play and need to play in the future.
Thank you in advance for your thoughts on these important topics. We will be gathering comments through December 5th.