Payments are a part of our everyday life—from paying for groceries at a checkout counter, to receiving a salary payment through direct deposit. For the majority of these payments, traditional payment methods are used: wire transfers, Automated Clearing House (ACH), cards, checks, and cash (More information about current U.S. payment systems can be found in Appendix 3 of The U.S. Path to Faster Payments: The Faster Payments Task Force Approach). The market continues to develop a variety of channels to initiate and accept payments, such as online and mobile payment applications, that provide greater speed and convenience for end users while relying on traditional payment methods like cards and ACH.
Traditional and new payment methods provide many options for consumers and businesses to make and receive payments; however, none of today’s payment methods fully satisfies the goals for a faster payment system as articulated in the task force’s Faster Payments Effectiveness Criteria. And while innovative new payment solutions are being developed to meet demands for greater speed and convenience, these new solutions cannot easily provide a way for a faster payment to be sent seamlessly between any two end users.
Because the implementation of faster payments in the United States may involve the development of new infrastructures, an opportunity exists to create payment systems that better meet stakeholder demand for improvements in not only speed, but also ubiquity, efficiency, safety, security, legal framework, and governance.