Fall 2018 Progress Report Now Available: Payment Improvements Continue to Gain Momentum

We are pleased to announce the release of our Fall 2018 Progress Report (PDF)! The report highlights the important work we’ve completed in collaboration with the industry and next steps we’re taking toward the desired outcomes for speed, security, efficiency, international payments and collaboration as outlined in the Strategies for Improving the U.S. Payment System (PDF) paper. We encourage you to review the progress report and think about how your organization can engage with us in our journey toward a better payment system for the future.

Some of the exciting accomplishments and next steps include:

Speed

  • Accomplishment: Reached a major milestone in the Fed’s Settlement and Service Provider Assessment with the release of a Federal Register Notice that seeks public comment on potential actions the Federal Reserve could take to facilitate real-time interbank settlement of faster payments
  • What’s Next: Engage with stakeholders and encourage feedback on the Federal Register Notice through the public comment process, which will be critical to informing the assessment and determining a course of action

Security

  • Accomplishment: Sponsored secondary research and consulted with several industry stakeholders to identify payments fraud causes and contributing factors to help inform the Fed’s next steps for industry collaboration to improve payment security
  • What’s Next: Engage the industry to further Federal Reserve and industry understanding of trends, vulnerabilities and fraud mitigation strategies related to remote payments, the use of synthetic identities, and emerging payments

Efficiency

  • Accomplishments:
    • Supported the Business Payments Coalition in publishing the paper, Simple Remittance Requirements (PDF), which defines data needs for simple remittance information that can be easily adopted by small to medium businesses
    • Conducted a series of webinars and in-person road shows in support of the proposed Fedwire® Funds Service migration to the ISO® 20022 messaging format standard
  • What’s Next:
    • Continue research by the Business Payments Coalition work group to explore availability of APIs for small business accounting software that could enable greater adoption of electronic payments
    • Continue the series of online webinars to educate customers and vendors about the proposed ISO 20022 implementation plans for the Fedwire Funds Service and ACH tools in the marketplace to support integration in the network

International

  • Accomplishment: Engaged payment industry stakeholders at the FedPayments Improvement Community Forum on developments in cross-border payments and opportunities for industry collaboration
  • What’s Next: Continue work to assess the FedGlobal® ACH strategy for potential future service border payments

Collaboration

  • Accomplishment: Hosted the inaugural FedPayments Improvement Community Forum where more than 250 members of the FedPayments Improvement Community engaged in dialogue on faster payments updates, as well as developments in payments security, efficiency, innovation and cross-border.
  • What’s Next: Share information and key takeaways from the FedPayments Improvement Community Forum with all Community members

To see a detailed summary of all accomplishments and next steps, check out the full version of the Fall 2018 Progress Report (PDF) and stay engaged in our payments improvement initiatives by joining the FedPayments Improvement Community.

Thank you FedPayments Improvement Community Forum Attendees

Thank you to everyone who attended the inaugural FedPayments Improvement Community Forum in Chicago this week. You brought passion and enthusiasm to the Forum, and your dialogue and engagement is helping to shape the future of a faster, safer and more efficient payment system in the United States.

Did you miss the event? Over the coming weeks, visit the Forum page on FedPaymentsImprovement.org to access summaries of these sessions and the exciting ideas that emerged from them.

There, you will also find meeting materials, speaker biographies and the agenda from the Forum. We covered a variety of topics, including:

  • Next steps in the Federal Reserve’s payment security strategy
  • Key insights on payments efficiency
  • Newest updates on U.S. faster payments
  • Opportunities for industry collaboration in cross-border payments.

Through active collaboration with industry we are making significant advancements in our payments improvement initiatives!

To hear more about the Federal Reserve’s work and participate in this historic effort to collaborate, engage and transform the U.S. payments system, join the FedPayments Improvement Community.

Survey Yields Important Insights for Proposed U.S. Faster Payments Council

A recent survey of payments industry stakeholders on the draft Operating Vision for the proposed U.S. Faster Payments Council (FPC) revealed support for the organization as well as insights on how it could be changed to better serve the needs of the payments industry.

The Governance Framework Formation Team (GFFT) has released a report (PDF) summarizing the findings from the survey, which was designed to elicit feedback on the FPC’s draft Operating Vision (PDF), including the GFFT’s proposed approach to the mission, guiding principles, structure, authority, funding and core focus areas of the organization. The vision of the FPC is to facilitate a ubiquitous, world-class payment system where Americans can safely and securely pay anyone, anywhere, at any time and with immediate funds availability.

The survey was fielded during a 60-day stakeholder feedback period, April 24 –June 22, during which the GFFT conducted an extensive education and outreach campaign to inform a diverse range of stakeholders about the FPC. The 34-question online survey generated 178 survey submissions and more than 1,000 written comments.

Overall, survey respondents within each stakeholder group were in at least general agreement with almost all aspects of the FPC, including the need and rationale for the FPC, its guiding principles, core functions, membership, Board of Directors, committees and work groups, and decision-making processes. In addition, nearly 70 percent of respondents were interested in joining the FPC. Level of interest varied across segments, however, with 60 percent or more of financial institutions of all sizes, business end users and “other” respondents expressing interest, and more than 80 percent of non-bank providers also expressing interest. Consumer interest organizations and government end users were more neutral or disinclined to join.

Respondents across stakeholder groups also offered a variety of comments, concerns and suggestions on certain aspects of the FPC. Thematically, comments focused on the FPC’s likely effectiveness and speed in achieving results; potential tradeoffs between inclusiveness and the proposed funding model; and the exact nature of the functions, authority, and Board structure of the FPC. Moving forward, these inputs from stakeholders will be an important part of the Governance Framework Formation Team’s deliberations in reworking the Operating Vision to meet the faster payments industry’s needs.

For additional findings from the survey, download and read the full report here (PDF). To stay abreast of the latest news from the GFFT and other strategic payments initiatives, join the FedPaymentsImprovement Community.

Improve Payment Security with Current Resources – and More to Come

A recent Federal Reserve webinar (Off-site) offered practical advice about how to use online resources to improve payment security – taking another step toward achieving a future of secure, fast and efficient payments that meet the current and future needs of consumers and businesses in the United States.

These online resources – the Information Sharing Data Sources (Off-site) and Payment Lifecycles and Security Profiles (Off-site) – were published by the Secure Payments Task Force. This coalition of more than 200 payment industry stakeholders was active from June 2015 to March 2018 as a forum for stakeholders to advise the Federal Reserve on payment security matters and determine areas of focus for payment security and priorities for action.

“There’s not a lot of formal education around payments… This [resource] isn’t just for banks, or organizations, or non-bank providers. It’s for everyone in the ecosystem,” said Bryan Penny of Nordstrom. Penny went on to describe uses of the Information Sharing Data Sources (Off-site) published by the Secure Payments Task Force. “When you get into payments, if you just start searching the web, you don’t know if that source is reliable and has good information. All these sources were vetted by experts.”

Suzanne Martindale of Consumers Union (publisher of Consumer Reports) described another task force deliverable, the Payment Lifecycles and Security Profiles (Off-site). These profiles of eight common payment types – from enrollment through transaction flow to reconciliation – “are meant to highlight potential vulnerabilities in various payment types, to educate stakeholders, from the experts to folks who are new [to payments], and encourage best practices in payments security.” This resource is being used “by everyone and anyone,” she said, including business leaders, product developers, risk managers and consumer advocates (including Suzanne herself).

Ed O’Neill, former Federal Reserve System vice president of secure payments, characterized the two task force deliverables as “a valuable foundation for our next phase of work.” The Federal Reserve kicked off a payments fraud study in March 2018 to analyze and prioritize payment system vulnerabilities. This research is intended to help inform the Federal Reserve’s ongoing collaboration with the industry to enhance end-to-end payment security. Key findings of the study and next steps to advance payments security are expected to be announced later this year, O’Neill said.

For more information:

Join Us for the Inaugural FedPayments Improvement Community Forum

Are you interested in being involved in the United States’ journey toward a faster, safer, more efficient payment system? Don’t miss the opportunity to attend the inaugural FedPayments Improvement Community Forum on October 3 – 4, 2018!

The Forum will be hosted in downtown Chicago and is your opportunity to collaborate and provide feedback on the latest payment system improvement initiatives. Designed to encourage robust dialogue on a plethora of topics, this event will consist of workshop-style sessions so you can weigh in on a variety of payments topics. Register now and stay tuned for future announcements on sessions, speakers and how you can stay engaged.

Register to Attend

The FedPayments Improvement Community Forum will be hosted at the JW Marriott in downtown Chicago. The Forum will begin at 12:00 p.m. CT on October 3, and will conclude by 5:00 p.m. CT on October 4.

Register to attend the FedPayments Improvement Community Forum (Off-site)

Join the FedPayments Improvement Community

In order to better engage with you during the event, as well as keep you up to date on the latest in payment system improvement topics, sign up to be a member of the FedPayments Improvement Community.

U.S. Faster Payments Council Proposed: Industry Encouraged to Review, Comment

A draft framework for a faster payments governance organization to be called the U.S. Faster Payments Council is now available for broad industry review and feedback. The goal of the proposed U.S. Faster Payments Council is a ubiquitous, world-class system in 2020 where Americans can safely and securely pay anyone, anywhere, at any time and with immediate funds availability.

  • The U.S. Faster Payments Council represents the work of the Governance Framework Formation Team (GFFT), a diverse group of payments industry stakeholders that was established by the former Faster Payments Task Force to advance the first recommendation of the Task Force’s final report (Off-site, PDF).
  • The GFFT’s goal is to develop a faster payments governance framework, inclusive of all stakeholders, to make decisions to facilitate interoperability and achieve ubiquity of faster payments in 2020, as well as navigate future challenges as technology and end-user needs evolve. Establishing an industry governance framework is critical to sustaining progress and successfully executing many of the task force’s recommendations.
  • The GFFT is now seeking broad industry feedback on the draft Operating Vision (PDF) of the proposed U.S. Faster Payments Council. The design remains a work in progress, with a number of open issues, including the Board and funding structure. Your feedback is important to ensure the U.S. Faster Payments Council meets industry needs.

Why is the U.S. Faster Payments Council needed?

A number of new and innovative faster payment solutions have come to market in the United States and others may be emerging soon. The proposed organization would focus on private-sector approaches to solving problems and removing barriers to achieving ubiquity. Achieving ubiquity means facilitating interoperability so that transactions flow across solutions in a seamless way. It also means enabling all end users to receive faster payments from any and all payers, as this will make origination of faster payments more attractive to payers and drive overall adoption.

In 2020, here’s what a ubiquitous, world-class faster payment system would look like:

  • Payments and payment information move seamlessly for end users, regardless of the varied solutions they may be using;
  • Effective cross-solution risk management enables trust and public confidence in the safety and security of these new, interoperable faster payments to flourish;
  • Payers and payees receive confirmation of a payment within seconds, even when the payment moves across solutions; and
  • All parties have equitable access to efficiently resolve disputes and errors.

Your voice matters!

Visit FedPaymentsImprovement.org to learn more and respond to an online survey, available now through June 22. Your feedback on the draft Operating Vision is vital to inform next steps in the U.S. faster payments ecosystem. Also, watch for information on upcoming webinars and conference presentations. And as always, stay tuned for updates on the FedPayments Improvement Community.

Progress Report Now Available: Review Accomplishments and Look Ahead to Future Plans

Today, we are excited to announce the release of our Spring Progress Report (PDF), which outlines the important work we’ve completed and next steps toward achieving better, safeprogress report bannerr, faster payments for everyone.

As you’ll see in the Spring Progress Report, we had another busy year! Highlights and next steps of our payments improvement journey include:

Speed

  • Accomplishment: Published the Faster Payments Task Force’s final report, The U.S. Path to Faster Payments, which includes the challenges and opportunities for achieving faster payments in the United States and the task force’s recommendations and suggested next steps
  • What’s Next: Facilitate stakeholder feedback on the Governance Framework Formation Team’s proposed faster payments governance framework

Security

  • Accomplishment: Published the Secure Payments Task Force’s Information Sharing Data Sources and Payment Lifecycles and Security Profiles
  • What’s Next: Conduct a Fed-sponsored study designed to inform industry security improvement efforts and analyze payment system security vulnerabilities and the costs and benefits of various approaches to mitigate them

Efficiency

International

  • Accomplishment: Continued ongoing education and outreach efforts regarding service enhancements and tool development geared at driving faster, safer, and more efficient payments, which included updates to the International Payments Resource Centers
  • What’s Next: Advance progress on an update to the Fedwire® Funds Service that expands the Federal Reserve Banks’ market practice to identify SWIFT’s® Global Payments Innovation (GPI) bank transfers in the Fedwire Funds Service message format in early 2019

Collaboration

  • Accomplishment: Facilitated the collaborative work efforts of the faster payments Governance Framework Formation Team, Secure Payments Task Force, Business Payments Coalition, and ISO 20022 Stakeholder Group
  • What’s Next: Initiate enhanced programming, focused on flexibility and engagement, for the 4,000+ FedPayments Improvement Community members, covering initiatives such as the faster payments governance framework, the Secure Payments Task Force’s educational resources, electronic invoicing, B2B payments education, and the ISO 20022 migration plan

To see a detailed summary of these accomplishments and next steps, check out the full version of Spring Progress Report (PDF) and stay engaged in our payments improvement initiatives by joining the FedPayments Improvement Community.

Coming Soon: Draft Faster Payments Framework for Stakeholder Feedback

A framework to help drive the industry toward ubiquitous faster payments is about to make its debut.

In its final report published last July, the former Faster Payments Task Force identified establishment of this industry governance framework as critical to sustaining progress and successfully executing many of its recommendations. The task force then “passed the torch” to the current Governance Framework Formation Team (GFFT) to propose a framework that would bring the groups’ shared vision to reality: in 2020, a ubiquitous world-class system where Americans can safely and securely pay anyone, anywhere, at any time and with immediate funds availability.

Later this month, the GFFT will begin soliciting broad industry feedback on the draft framework, which details the operating vision, guiding principles and core governance functions of a membership organization inclusive of all payments industry stakeholders that will work toward ubiquity in a faster payments ecosystem. With its focus on facilitating dialogue and collaboration across the wide array of faster payments stakeholders, the proposed organization will work with industry stakeholders to address gaps and barriers to faster payments adoption and support achievement of the industry goal of ubiquitous access in 2020.

Your voice matters!

Watch for news about the framework’s launch, as well as opportunities to share your feedback via an online survey, webinars, conferences and other engagements. If you are not yet a member of the FedPayments Improvement Community, join now to be notified when the draft framework is published.

Enhanced FedPayments Improvement Community Puts you in Control

We believe that industry collaboration with diverse payment stakeholders is paramount to the success of the Federal Reserve’s payments improvement initiatives. Our commitment to stakeholder engagement is what led us to create the FedPayments Improvement Community back in 2015, and remains the driving force behind the enhancements we’re introducing today. As first described in Federal Reserve Next Steps in the Payments Improvement Journey (PDF), the enhanced FedPayments Improvement Community aims to provide opportunities for all stakeholders to engage in our full portfolio of payments improvement initiatives.

To better help you take advantage of the improvements, here is a summary of the changes and the actions you can take as a new or existing member to get the most out of the enhanced FedPayments Improvement Community:

What’s Changing?

  • We will collect information about your industry segment, your role, and payment system improvement topics and initiatives on which you would like to engage
  • Selecting your areas of interest will allow you to engage with us when and how you wish, as well as give you the opportunity to participate in work groups as they are established
  • Members of the FedPayments Improvement Community will also be notified of opportunities to provide feedback on work group and/or Fed-sponsored work efforts and be invited to attend our online and in-person events

New Members

Existing Members

The FedPayments Improvement Community will continue to be free and open to all interested stakeholders and represent a continuation of transparent, inclusive, and effective engagement. We look forward to engaging with you!

Secure Payments Task Force Publishes Payment Lifecycles and Security Profiles

As announced earlier today, the Secure Payments Task Force published the Payment Lifecycles and Security Profiles, educational materials outlining, the lifecycles, security characteristics and relevant laws and regulations for the most common payment types.

Developed through collaborative efforts of task force participants with diverse payments and security expertise and perspectives, the Payment Lifecycles and Security Profiles provide perspectives related to:

  • The lifecycles of the most common payment types, covering enrollment, transaction flow and reconciliation
  • Security methods, identity management controls and sensitive data occurring at each step in the payment lifecycles
  • Relevant laws and regulations, and other references, as well as challenges and improvement opportunities related to each payment type

“We believe the profiles are a valuable tool for all payments providers to assess where they can enhance their operations and improve overall payment security practices,” said Christopher Danvers, vice president of payments and digital services for American Airlines Federal Credit Union, who co-chaired the work group responsible for the profiles. “Our hope is that this information can raise awareness and understanding of payments security and risk issues across the many types of organizations that have a hand in the payments system,” Danvers remarked.

“The task force brought together a diverse group of organizations that have many different capabilities and experience, all of which were critical to studying the entire payments ecosystem,” said Reed Luhtanen, senior director of payments strategy at Walmart, who co-chaired the group with Danvers. “The resulting profiles will be an incredibly valuable resource for merchants, financial institutions and other businesses to use in educating anyone in their companies who has a role in payments, whether in customer support, information technology or product development.”

“The task force has been an important forum for bringing focus to our collective security dialogue, creating a foundation for ongoing collaboration on specific security topics,” said Ken Montgomery, the Federal Reserve’s payments security strategy leader and chief operating officer of the Federal Reserve Bank of Boston. “The security challenges facing the payments industry require broad cooperation and coordination across the payments ecosystem. Strong stakeholder collaboration is key to maintaining public confidence in the U.S. payment system and keeping pace with the rapidly evolving and expanding threat environment.

Read the full press release for more details.