It looks like the U.S. market will finally join a large number of other countries and offer real-time payments—but can ubiquity be achieved?
There are currently two major initiatives underway in the U.S. The first is the real-time payments project being executed by The Clearing House, with a pilot date of Q1 2017. The second initiative is the Faster Payments Task Force, which is being led by the Federal Reserve. The Faster Payments Task force is expected to publish their final report on their findings around the end of Q2 2017.
While The Clearing House is developing a single system to support real-time payments, the Faster Payments Task Force will not be picking a winner or loser from the over 20 RFPs received, but rather the viability of each solutions measured against pre-defined effectiveness criteria and use cases.
This is an important distinction, as it is totally feasible that the U.S. market could have multiple solutions—at least three—to support real-time payments in the U.S. This would be a departure from all the other countries that have a real-time payments scheme, as these countries have only one national real-time payments solution.
Given this scenario, banks will pick a real-time payments solution that best fits their business requirements and implementation costs, both internally and externally.
As such, the interoperability between these real-time payment solutions will be critical in order for the U.S. market to achieve ubiquity for real-time payments, otherwise we will have fragmented solutions that is not capable of addressing the fundamental benefit of real-time payments anytime, anywhere and to anyone.
Douglas Green is a director at Volante Tecnologies and a member of the Fed's faster payments task force.