Hot on the heels of the Fed’s Faster Payments Task Force final report and call for the industry to implement faster payments in the U.S. by 2020, SWIFT is offering a gateway.
The global financial messaging provider announced on Aug. 15 that it will provide U.S. institutions with a gateway to The Clearing House’s real-time payments (RTP) platform. And as instant payments become more ubiquitous in the U.S., SWIFT said it will provide an interface to manage the requirements of sending and receiving domestic instant payment transactions on behalf of customers.
TCH is building a new clearing and settlement system to support domestic instant payments in the U.S., enabling consumers and businesses to send and receive payments in real-time and directly from their accounts at financial institutions. It will also include data and non-payment messages financial institutions can use for digital commerce solutions.
SWIFT will give U.S. banks the ability to access a single platform, Alliance Messaging Hub (AMH) for both SWIFT high-value payments and low-value TCH real-time payments, according to an announcement.
AMH is an orchestration layer that includes a gateway to the TCH RTP network, as well as other gateways and APIs, which enable financial institutions to connect to other non-SWIFT networks. The solution will be commercially available by early 2018.
“SWIFT is working together with communities worldwide to support the global shift towards real-time payments, and we are pleased to be at the forefront as the U.S. market evolves,” said Ignacio Blanco, director of strategic relationships at SWIFT. “The Clearing House is making great strides in accelerating the speed of transactions, and we are committed to playing our part in helping the financial community to operate as efficiently as possible.”
“Achieving our vision of broad adoption of real-time payments will only be possible when the majority of U.S. institutions are able to participate, and SWIFT will be instrumental in helping us meet this goal,” said Steve Ledford, SVP Product and Strategy at The Clearing House.
SWIFT has struck similar deals in Australia and Europe and stands to benefit from the potential of connecting these systems for cross-border instant payments. In 2015, SWIFT was awarded the contract to deliver the messaging infrastructure to underpin Australia’s new payments platform, NPPA, which is expected to go live later in 2017.
Earlier this year, SWIFT announced the launch of an instant payments messaging solution, first for the European market, and elsewhere, that enables instant payments to be made over the SWIFT network via a single gateway to connect to multiple instant payments systems.
An Ovum, ACI research study recently revealed that 66 percent of banks in markets with immediate payments initiatives view them as key drivers of revenue, while 60 percent say they will reduce costs and 61 percent say instant payments will improve their value propositions and service.
Related stories:
- Faster Payments Task Force Sets Ambitious Goal for 2020
- Starling Bank First Digital Challenger to Join Faster Payments
- SWIFT Unveils Instant Payments Messaging for Europe
