Real-Time Payments: Emerging Technologies and...
Transcript of Real-Time Payments: Emerging Technologies and...
Real-Time Payments: Emerging Technologies and Trends
Thursday, May 25
Chris Burfield Keith Gray
Esther Pigg
Session Agenda
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• Introductions
• The future of real-time payments – and why it matters to you
• Industry updates
• Highlight: The Clearing House Real Time Payment Solution
• FIS real-time payment strategy and solutions
• Q&A
Introductions
Chris Burfield
SVP, Payment Strategy
Enterprise Product Office
Esther Pigg
SVP, Product Strategy
FIS Global Retail Payments
Keith Gray
VP, Business Development
The Clearing House
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R E AL - T I M E
TRENDS
A MOVE TO FASTER PAYMENTS
PAYMENT MODERNIZATION
L E G A C Y I N F R A S T R U C T U R E C R E A T I N G F I N A N C I A L
A N D F U N C T I O N A L O B S T A C L E S
COMPETITORS FOCUS ON P2P
T E C H F I R MS P U R S U E C U S T O ME R S W I T H I N S T A N T P 2 P ;
D I S I N T E R ME D I A T I O N T H R E A T T O B A N K S
U.S . FOLLOWING GLOBAL LEAD
F E D & F I N T E C H H A R V E S T I N G L E S S O N S F R O M E X P E R I E N C E S
EXTENSION OF CARD NETWORKS
D E V E L O P M E N T O F ‘ P U S H ’ C R E D I T C A P A B I L I T I E S
Industry Updates
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• Fed: Strategies for Improving the U.S. Payment System
• Existing Network Evolution:
– Same Day ACH
– Card Network Initiatives
• Emergence of New Networks:
– The Clearing House Real-time Payments Network
– EWS / Zelle
Federal Reserve: Strategies for Improving the U.S. Payment System
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The Faster Payments Task Force launched in April 2015.
• Objectives:
– Represent views on future needs for a safe, ubiquitous faster payments solution
– Address other issues deemed important to the successful development of effective approaches
– Assess alternative approach(es) for faster payments capabilities
• Desired Outcomes:
– Speed
– Security
– Efficiency
– International
– Collaboration
Recent Publications:
• Jan 2017 Progress Reporthttps://fedpaymentsimprovement.org/wp-
content/uploads/progress-report-january-17.pdf
Next Up:
• Mid-2017 Final Report!
Criteria Grouping Category Names
Ubiquity Accessibility Contextual Data capability
Usability Cross-border functionality
Predictability Applicability to multiple use cases
Efficiency Enables competition Comprehensiveness
Capability to enable value-added services Scalability and adaptability
Implementation timeline Exceptions and investigations process
Payment format standards
Safety and Security Risk management Handling disputed payments
Payer Authorization Fraud information sharing
Payment Finality Security Controls
Settlement approach Resiliency
End-user data protection End-User /Provider Authentication
Participation Requirements
Speed (Fast) Fast Approval Fast Clearing
Fast Availability of Good Funds to Payee Prompt visibility of payment status
Fast Settlement among Depository Institutions and Regulated Non-bank Account Providers
Legal Legal Framework Payment System Rules
Consumer protections Data privacy
Intellectual property
Governance Effective Governance Inclusive Governance
Faster Payments Task Force Effectiveness Criteria
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NACHA Same Day ACH
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Card Network Evolution
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• Visa Direct and MasterCard Send focus on $10 trillion
"push" payments market
– Real-time P2P payments and business disbursements
– Reaching 97 percent of U.S. debit card accounts
• Push a credit transaction to a card account in minutes
– P2P capabilities enable senders to transfer funds to a recipient's
debit card
– Extends traditional credits on returned merchandise to insurance
claims, health care reimbursements or payments to independent
contractors
Sources: Visa, MasterCard
The Clearing House RTP
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Provides rails for all FIs either directly or through a service provider
Note: There should be no difference in the user experience for customers of direct FIs and those connecting through a TPSP.
TCH RTP is Real-time in Every Way
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24/7RTP
Clearing 24/7
Continuous Input/Output
Continuous Settlement
Immediate Confirmation = Simplified Reconciliation
Real-time postingand visibility
RTP Distinctive Features
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Payment Status
Immediate notification of successful transfer to end users, providing certainty for both senders and receivers
Payment Certainty
Receivers have certainty that payments will not be reversed or revoked
Complete AR/AP Messaging
Ability to link multiple messages associated with the same transactions through a common reference
Data Extensibility
Allows banks to develop Value added services based on extensible data
Fulfillment Messaging
Ability to provide confirmation by the receiver that they have received funds, combined with fulfillment information
Immediate Availability of Funds
Receivers have funds available in real-time 24/7/365+
Credit Push Only
Customers send payments directly from their existing accounts – complete transparency, no pending payments
Global Ready
ISO 20022 is a global standard that supports the needs of multi-national customers and will enable cross-border payments in the near future
With RTP, FIs can offer new services and improve existing ones
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Efficient
Safe
Immediate• RTP makes payments immediate and final• Quicker closure means no loose ends and ability to move on to what’s next
• Payments and information travel together • Efficient way to improve reconcilement and other processes
• Avoid off-cycle ACH batch processes• Reduce exceptions • Potentially improve liquidity management
• Trusted and secure bank channel• Reduce fraud risk (and related costs)
Putting new RTP Capabilities to Work: Payments Innovation
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Zelle
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WHAT IS ZELLE?
WHY ZELLE?
‣ NAT I O NA L D I RE CTO RY
‣ RE A L -T I ME S E RV I CE S
‣ CO NS UME R B RA ND
‣ F I -CE NT RI C
‣ UB I Q UI TO US
‣ E MB RA CE D A ND MA RK E T ED B Y L A RG E ST F I s
FIS Real-Time Payments Strategy
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A Pathway to Capitalizing on the Latest Advances in Real-Time Payments
FIS PARTNERSHIP
COMMITMENT TO EMPOWERING
SAFE, UBIQUITOUS AND FASTER PAYMENTS
F I S RE A L -T I ME
PAYME NT S O FFE RI NG S
ZELLE
INTEGRATED P2P
FIS PEOPLE PAY P2P
FIS OPEN PAYMENT
FRAMEWORK (OPF)
FIS PAYNET
GLOBAL PAYMENTS
BILL PAY VIA
THE CLEARING HOUSE
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FUTURE PROOF
YOUR INFRASTRUCTURE, OPTIMIZING YOUR INVESTMENTS
BUILD CUSTOMER LOYALTY
OFFERING SECURE, REAL-TIME CAPABILITIES
EXTEND INDUSTRY LEADERSHIP
LEVERAGING THE FIS PAYMENTS ECOSYSTEM
GAIN COMPETITIVE ADVANTAGE
THROUGH DATA INSIGHTS
INNOVATE FASTER
WITH DEEP PAYMENTS INTEGRATION
Questions / Discussion