X9 forms real-time payments study group

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The Accredited Standards Committee X9 is forming a group to study faster and real-time payments activity in the financial industry and eventually recommend new X9 standards and upgrades that would enhance interoperability and adoption.

Because multiple providers offer real-time payments, X9 says it needed the study group to help push the comprehensive adoption that would come from interoperability among the systems.

"The work of this study group will fill an important need in the financial industry's movement toward real-time payments," Stephen Lange Ranzini, president and CEO of University Bank and University Bancorp Inc. and chair of the initiative, said in a Thursday press release.

"We'll take a thorough look at the payments ecosystem, identifying gaps in current X9 standards and the need for new standards covering real-time payments," Ranzini added. "Then we'll deliver comprehensive recommendations that can serve as a roadmap for future efforts by X9 and other bodies involved in payments standards."

The X9 Real-time Payments Study Group would help establish additional standards beyond the basic payment messaging standards and those for electronic data interchange, including ISO 20022 and X9's BTRS/BAI2 standards.

ISO 20022 operates as a financial transaction messaging standard vital for faster payments, while BTRS is the balance and transaction reporting standard established to replace the BAI2, which had set a common format for exchanging corporate-to-bank data.

Part of the study group's mission would also be to address more use of real-time payments in those sectors that continue to rely heavily on paper billing, such as health care payments.

Enhanced information security standards are also in need of further study, the committee says, as existing legacy electronic payments continue to suffer from significant fraud losses in the U.S.

The study group will work closely with prominent clearing and standards organizations as they introduce new payment methods, engaging in education and information gathering from real-time payments providers to learn their plans and to determine with them whether there are any unmet needs for technical standards that X9 can provide.

X9 says it is seeking additional participants in the study group. ASC X9 operates as a non-profit organization accredited through the American National Standards Institute to maintain national and, through ISO, international standards for the financial services industry.

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