Reed Luhtanen, Executive Director, FPC
Today, if you wanted to illustrate the rise of faster payments, there’s a myriad of things you can point to. First and foremost, you can highlight the increased volume of faster payments. Just look at the rise in RTP®: In the second quarter of 2022, the Network processed 41.2 million transactions, an increase of 12 percent over the first quarter of 2022. And consider Same Day ACH. The ACH Network transferred a total of 185 million same-day transactions in the second quarter of 2022, which equates to 24.4 percent growth since Q1 2022. That’s almost 230 million faster payments in one quarter. And that’s without FedNowSM, which will surely bump volume once that network comes online next year.
But it’s not just transaction volume that speaks to the heightened emphasis on faster payments. You can also point to the number of new solutions. Today, more faster payments products are being developed and launched than ever before. And, at the FPC, we’ve seen this firsthand. In January 2021, we released our first State of Play in U.S. Faster Payments report, which provided a review of the faster payments landscape, detailing current use cases and the ins and outs of the different networks that provide faster payments services. In that initial report, we examined seven networks. Just last month (only a year later), we issued an update to that report, and the number of networks examined grew from seven to 11.
And this growth in new solutions is surely a response to the expanding list of faster payments use cases. In the beginning phases of faster payments, use cases were somewhat limited. Payroll, business-to-business payments, and disbursements dominated conversations. Today, the FPC estimates there could be upwards of 130 use cases or more. One of our latest efforts, a use case repository, details those actions driving faster payments growth from Cash on Delivery (CoD) to e-wallet transfers. As time goes on, new solutions are developed, and new technology is implemented, the use case list will continue to grow.
But what this rise – in transaction volume, solutions, and use cases – ultimately points to is a new need for educated professionals, individuals who can serve as experts on all things faster payments. Volume will increase, and it begs the question of how organizations can efficiently, safely and securely support faster transactions, while remaining in compliance. Solutions will proliferate, and financial institutions and organizations of all sizes will need to be able to understand the nuances of each solution, from governing regulations to payment types supported to speed of the solution and settlement timing.
This is why the FPC is so excited to collaborate with Nacha and the Payments Associations to bring to the industry an Accredited Faster Payments Professional (AFPP) Program. Announced last week, the program will build on Nacha’s planned Faster Payments Professional (FPP) certificate program, which will provide individuals an overview of the fundamentals of faster payments, the functionality, and the fraud, risk, and legal considerations of these payments to deliver an advanced, comprehensive and centralized accreditation program. The goal is to support, grow, and validate faster payments experts in our community. The first module for the Faster Payments Certificate Program will be offered later this year, and the first AFPP exam will be provided in late 2024 or early 2025.
The AFPP will be a no-brainer for our community. Having that level of knowledge, understanding, and proficiency of faster payments will be instrumental in furthering compliance, adoption, use, and growth. As such, once it becomes available, I encourage all industry professionals to consider taking part in the offering. It will go a long way for you as individuals, for the organizations you support, and the larger faster payments ecosystem. In the meantime, I encourage you to continue learning and growing by being sure to leverage the resources in the FPC’s Knowledge Center. New educational materials, resources, and tools are added frequently, so be sure to check in often.
Because knowledge will be key to our industry’s faster payments future. All signs point to faster payments’ rise in prominence as they become more mainstream. Now’s the time to ensure sure you and your organization are ready to embrace and grow with them.