Reexamining Challenges as Opportunities to Advance Faster Payments
Reed Luhtanen, Executive Director & CEO, FPC
Conversations at the FPC’s Spring Member meeting revealed an important shift in perspective: challenges once seen as barriers are now being reexamined as opportunities for innovation—especially when it comes to fraud.
The opportunity for fraud mitigation innovations
The Spring Member Meeting provided a level set around fraud. During the Meeting, panelists shared findings from a recent survey conducted by the Fraud and Scam Mitigation for Faster Payments Work Group on instant payments adoption. According to the survey, fraud was the top reason for not implementing both instant payments send and receive. Not surprisingly, stronger fraud mitigation, monitoring, and resolution tools ranked among the top means to increase adoption.
But this raised the question of why is fraud so inherently difficult to manage? In other sessions at the Meeting, panelists provided a real take on where the industry is currently going wrong with fraud prevention. From treating fraud mitigation as only a compliance function to looking at fraud by payment channel or individual rail to even treating customers as static, the current measures and tactics are not looking at fraud holistically and as an opportunity to build a better, safer experience.
The path forward will require a more holistic approach. The Spring Member Meeting examined how artificial intelligence and data can transform fraud prevention and mitigation. And when harnessed with a more holistic view in mind, fraud becomes more predictable; customer assets and organizational capital are better protected; and compliance becomes embedded in everyday processes, enhancing the whole faster payments experience, and driving growth.
From fraud to the future
And at the end of the day, growing faster payments access and adoption is the whole point. To aid that quest, the FPC recently released three new resources. First, theInstant Recurring Payments: Unlocking Opportunities in High-Growth Vertical Markets White Paper, developed by the Instant Recurring Payments Work Group, examines instant payments’ potential for verticals like insurance, subscription services, investment management, utilities and more, outlines the current payments challenges within these verticals, and highlights the value proposition that instant payments can provide.
Then, the Business Benefits of B2B Instant Payments Work Group developed two blogs to address opportunities for corporate adoption of instant payments. The blog B2B Instant Payments: The $10 Million Moment - Unlocking the Next Frontier chronicles the increase in instant payments transaction limits to $10 millionand outlines the instant payments use cases now possible, like merchant settlement and commercial real estate closings, which enable efficiencies, reduce fraud, and create more automation for businesses and financial institutions alike. The other blog, Stablecoins in B2B Payments: A Domestic Opportunity for U.S. Banks and Credit Unionsexplores how stablecoin solutions can be applied to current use cases to create efficiencies and cost savings and provides guidance on how financial institutions can position themselves as digital asset leaders to make the most of the opportunity around stablecoins. These three new resources showcase the expanding opportunities in faster payments across use cases and verticals and provide clear insights into how to ensure the industry can fully capitalize on what’s now available.
However you look at it, the opportunities for faster payments are abundant. While the industry still faces hurdles, they don’t have to slow progress, they can accelerate it. And the FPC is working to ensure we continue to fuel that momentum. If you’d like to help us carry things forward, consider becoming a member of the FPC. Learn more at www.fasterpaymentscouncil.org/why-join-the-fpc.