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The Path To Faster Payments Ubiquity Starts With You
Compared to traditional retail payments, faster payments have a number of distinguishing characteristics including speed and continuous service availability. The Committee on Payments and Market Infrastructures of the Bank of International Settlements defines fast payments as “payments in which the transmission of the payment message and the availability of final funds to the payee occur in real time or near-real time, and on as near to a 24-hour and 7-day basis as possible.”
The Faster Payments Task Force believed that an industry-led framework for cross-solution collaboration and decision making is needed to support achievement of a faster, ubiquitous, broadly inclusive, safe, highly secure, and efficient payment system. Specifically, a body such as the U.S. Faster Payments Council could facilitate successful pursuit of the task force goal of ubiquitous receipt – where multiple payment service providers are capable of receiving faster payments and of making those funds available to their end-user customers in real time. A coordinated, industry-wide and inclusive body will be more effective in facilitating adoption, enhancing security, and increasing user awareness than if the parties were to act separately.
In today’s increasingly mobile, digital economy, Americans require a world-class payment system where they can safely and securely pay anyone, anywhere, at any time and with near-immediate funds availability.
The FPC focuses on private-sector approaches to solving problems and driving ubiquity of faster payments. This includes supporting providers’ and network operators’ efforts to enable end users to easily use an array of solutions and networks to reach each other in ways that are as seamless and transparent to them mobile texting. It also involves supporting broad adoption of faster payments. As an independent, solution-agnostic organization, the FPC is in a unique position to work with industry stakeholders and tackle challenges that may be more difficult to address through bilateral cooperation alone.
The FPC will become the “go-to” organization for encouraging faster payments and providing thought leadership as the market evolves because it:
In carrying out its activities, the FPC will take a pragmatic approach, focusing on analyses that identify the most effective and broadly supported tool(s) to address a given issue. It will develop recommendations using the “lightest touch” approach to resolve an issue. Member organizations retain the discretion to implement the resulting recommendations in ways that are consistent with their unique needs and processes, including the choice not to implement any given recommendation.
According to the FPC Framework and operating documents, member organizations retain the discretion to implement FPC recommendations in ways that are consistent with their unique needs and processes, including the choice not to implement any given recommendation. The influence of the FPC may also extend to non-members by virtue of operator and service provider participation.
Members have the opportunity to influence the roadmap to faster payments ubiquity through inclusive, collaborative dialogue and problem solving, and will be informed by the perspectives of other members. All members, voting and non-voting, have the right to access work products, participate on committees and work groups, and adopt decisions and recommendations of the FPC according to their individual organizations’ needs and prerogatives (including the choice not to adopt). Voting members also have the right to vote on FPC recommendations, vote for Board members, and seek a seat on the Board.
The FPC focuses on private-sector approaches to solving problems and driving ubiquity. It is expected that a variety of approaches will be needed to achieve the seamless reach and transparency end users desire. For example, a technical approach at the rail level may make sense in certain cases, but in others, providers could opt to offer transparent overlays and connections to a variety of rails that will enable their customers to reach all other end users. The coordination and collaboration that the FPC can facilitate between multiple approaches is key to successfully meeting end-user expectations.
The FPC is open to all stakeholders in the U.S. payment system. Subject to FPC Board review, members self-select into the segment that best describes their organization’s primary role/interests as defined below:
|Financial institutions||State or federally chartered banks, credit unions and brokerage firms or organizations that represent financial institutions that provide payment services to end users and clear and settle payments on their behalf.|
|Payment network operators||Entities that operate a payment network infrastructure or organizations that represent such payment networks.|
|Technology providers||Entities (other than payment network operators and financial institutions) that process payments, facilitate use of payment networks and/or provide payments-enabling services to any other unaffiliated stakeholders, including end users; this segment would also include organizations that represent technology providers.|
|Consumer organizations||Organizations that represent natural persons for the purpose of making and/or receiving payments for personal, family or household use and not for commercial/business use.|
|Business end users||Organizations that make or receive payments for commercial/business use or entities that represent those organizations.|
|Others||Representatives from industry organizations with an interest in payments issues, such as associations, rules and standards organizations and consultancies.|
|Associate||Single-person businesses and individuals, such as academics, with a professional interest in payments issues who, if employed, are not in any way representing, reimbursed by, or funded by their employer organization.|
Single-person businesses and individuals with a professional interest in payments issues, such as those in academics, may join the FPC as non-voting associate members. To be eligible as an associate member, the applicant (if employed), must not in any way represent or be reimbursed by their employer organization.
The voting membership elects the FPC Board of Directors, which is accountable to the members for setting strategic direction and ensuring processes, activities and recommendations are consistent with the fundamental principles of the FPC. In addition, the Board is responsible for ensuring the views of segments with fewer members are heard during deliberations at the Board, committee and work group levels. The Board comprises up to 21 voting members representing the six membership segments. Segments include:
|Industry Segment||Number of voting Board seats|
|Payment network operators||3|
|Business end users||3|
Each voting segment is allocated 3 seats; however, seat allocations that are not filled are left vacant. In addition, 3 at-large seats will be allocated to the three voting segments with the largest number of members in a manner described in the bylaws, but no membership segment may have more than 4 seats. Each segment will vote to fill its own segment’s Board positions.
The FPC may also choose to invite public sector organizations, regulators, policymakers, or other entities that the Board determines will bring important view points and insight to participate in a non-voting liaison role. These liaisons may participate on committees and work groups and have access to work products, but may not serve on the Board or vote on general membership matters; they will also not pay dues.