When the Faster Payments Task Force first began their work to identify and assess alternative approaches for implementing safe, ubiquitous, faster payments capabilities in the United States they realized early on: words matter. That mantra has stuck with them throughout the two years of collaboration and work products, manifesting into the Task Force Glossary of Terms. In the time leading up to, and following, the release of Final Report Part Two we’ll be highlighting some of the glossary terms to level-set your understanding or their use throughout the report.
Ubiquitous is a word we refer to quite frequently when discussing improvements to the U.S. payment system, but what exactly does it mean in relation to payments? In the world of payments, ubiquitous refers to a payment system that can reach all accounts to ensure that a payer has the ability to pay any entity. In other words, a ubiquitous payment system is one where anyone can pay anyone no matter where they bank or who they are (individual, business, etc.). For example:
- Bob and Jane went to dinner at a restaurant that does not allow split checks, so Jane paid for them both. Bob, who is a customer of Financial Institution A, wants to pay Jill, who is a customer of Financial Institution B, for his half of the bill. In a ubiquitous payment system, the fact that they each bank with a different institution does not matter because both Bob and Jane are able to make payments that can reach any entity.
- You had a mobile pet grooming service come to your house to give your dog a haircut and bath. When it comes time to pay, you find out that the groomer only receives payments from the BizPay* smartphone app, while you use the PayBuddy* smartphone app. This would not be an issue in a ubiquitous payment system because you would be able to make and receive payments between all types of payment apps.
For more information on commonly used payment terms, and to brush up on task force lingo before the release of the Final Report Part Two in late July, check out our Task Force Glossary of Terms.