Trends & Research

Trends & Research

Access the power of data and objective insight. Data from various sources, including NEACH surveys and member interviews, is compiled and made available as white papers, case studies, articles, benchmarking, and industry reports to provide a snapshot of both the current and future payments landscape. 

Published on Monday, December 14, 2020

December 2020 Executive Summary -- Closing Out the Year with a Bang

This year has been a whirlwind of new developments in payments, fueled in part by the pandemic and, as we close out the year, that momentum continues. From the Fed’s request for input on topics ranging from a fintech sandbox to FedNowSM standard specs to PayPal launching cryptocurrency transactions, the close of 2020 sets the industry up well for continued modernization in the upcoming year.

Joe Casali and I actually hosted a fireside chat during our Winter Member Meeting on December 9 to share more about current trends and what the Innovating Payments program has in store for 2021. Also, keep an eye out for upcoming posts that both reflect on all that the industry has accomplished in 2020 and what’s to come in the new year.

For now, read on for those developments that are impacting the financial sector this month.


Fed Seeks Input

Across all of its initiatives, the Federal Reserve and the Federal Reserve Bank of Boston are in the information-gathering stage. From faster payments to business payments, the requests for feedback cover the gamut of some of the industry’s most pressing topics, specifically:



When it comes to immediate payments, the FedNow team seeks input on two key developments:

  1. ISO 20022 Specifications – An industry working group has met over the past few months to review and offer insights on draft FedNow Service ISO 20022 message specifications. According to a FedNow Community email, the majority of Working Group feedback supported the proposed message implementation guidelines, but there were recommendations for additional guidance or modifications. Specifically, the email noted the following takeaways:
    • Validation of the FedNow Release 1 ISO 20022 message portfolio; no gaps in message types were identified.
    • Strong preference from the participants to remain true to the ISO 20022 standard and the intended scope and use of the ISO 20022 messages. This will promote efficiency and effectiveness by reducing potential frictions and costs, which may occur with deviations from the ISO 20022 standards.
    • Requests that additional guidance be developed in some areas to promote consistency in information exchanges, for example, in the use of reason codes.

Any party interested in offering additional input on the draft specifications can do so by sharing feedback via email to Responses are due by December 16.

  1. Innovation Sandbox – The FedNow team is exploring the creation of a sandbox offering that would allow interested parties to “ideate, develop and test solutions that could be offered to their customers and financial institutions to ultimately help enable instant payments over FedNow. The objective of the sandbox is to promote innovation as well as allow for opportunity identification and concept building.” FinTechs, vendors, and other interested parties should share their thoughts via a survey by December 14.


Fed Payments Improvement

Beyond work in the faster payments realm, long-standing Fed Payments Improvement efforts continue full throttle. Most recently, the Fed has been seeking input on their fraud efforts through the Fraud Classifier Survey. Specifically, the Fed wants to better understand how the Classifier’s being used—and how it may potentially be improved. This short survey allows FIs to provide feedback on how they are using or planning to use the tool. Please consider spending a few minutes to share your feedback on how this tool may provide value to your institution.

Clearly, the Federal Reserve has made broad community input a priority, and inclusive feedback of the industry will help to shape their future products and services. We encourage you to consider these initiatives in the context of your own payments strategy, and NEACH will continue to keep you updated as more comes to light.



In another flurry of activity at the national level, Nacha has announced two key developments over the last month.

First, the ACH leader revealed that it successfully completed the first live transaction over Phixius, its new platform that “facilitates the trusted exchange of payment information.” According to the release, “Phixius provides interoperability between vetted participants who connect directly to the platform in order to more securely exchange data rather than storing it in a central repository, such as in the cloud. Transactions occur via standardized open APIs developed by Afinis Interoperability Standards and ISO20022.” Nacha intends for Phixius to “make business payments more efficient and secure.” FIs interested in finding out more about this opportunity can reach out to George Throckmorton at or go to

In a similar focus on business payments, Nacha also announced the launch of its ACH Rules for Corporates Resource Center. A “one-stop hub for corporate end users to keep up with developments to the Nacha Operating Rules and the ACH Network,” the Resource Center offers a number of helpful materials, including:

  • End-user briefings on specific Nacha Rules topics, including the upcoming expansion of Same Day ACH hours
  • The latest on upcoming changes to the Nacha Operating Rules, as well as proposed rules which are open for comment
  • Account validation resources
  • A sign up for Nacha’s Rules News emails so that the latest information arrives directly to a business’ inbox

To find out more about these offerings, visit the Resource Center.



Not to be outdone by traditional players, alternative payment providers, including the likes of PayPal and Google, have launched a series of announcements over the past month that speak to broader intentions in the payments space.

For example, PayPal announced that as of November 12, “all eligible PayPal accountholders in the U.S. can now buy, hold and sell cryptocurrency directly with PayPal.” Then, just five days later, the provider shared that it will begin offering earned wage access to employees via the PayPal app. The release notes that the company is “partnering with Even, the responsible on-demand pay platform, as part of its continued commitment to improve the financial health of its workforce.”

In other news, Google Pay announced a redesign that “heralds a smart DDA.” reports that Google is working with traditional financial institutions (FIs) to create Plex, billed as a mobile-first bank account that is integrated into Pay. The article goes on to state that when it launches in 2021, 11 banks and credit unions will be offering Plex.



This year certainly has ratcheted up the level of fraudulent attacks bankers have been left to thwart. From the CARES Act payments being gobbled up by fraudsters in a variety of schemes to the massive increase we’ve witnessed in ransomware attacks, new risk management protocols and solutions have been top of mind for FIs.

For example, ransomware truly is everywhere. Three ransomware families (Maze, Ryuk, and REvil) lead in the number of attacks, and reports indicate that REvil may have netted 81 million dollars from its attacks this year. Even more worrisome, the U.S. is on the top five list of countries under attack, reporting a 98.1% increase in the third quarter. And this is just the tip of the iceberg.

As a resource to fight against these new attacks, The Cybersecurity and Infrastructure Security Agency (CISA) and the Multi-State Information Sharing and Analysis Center (MS-ISAC) have released a joint Ransomware guide. For a broader take on the financial services impacts and recommendations, we connected with FS-ISAC CEO Steven Silberstein to get his take on the landscape and what’s next.

Silberstein shared that account access and authentication processes, global cyber intelligence sharing in the financial sector, and ongoing education remain critical to all risk and fraud mitigation programs. In particular, Silberstein emphasized the importance of collaboration to safeguard against these new threats: “Increasingly, cybersecurity is a shared responsibility of firms, employees, and customers. Therefore, ongoing education is important to make both customers and employees aware of best practices in cyber hygiene as well as how to recognize phishing, smishing, and other social engineering attacks,” he notes.

For more details on the broad brush of cybersecurity and some of the latest attacks, check out our Cyber Watch: Monthly Alerts & Updates in Cybersecurity.



There’s no doubt that this level of industry development impacts how FIs run their business operations, which is why we convened the New Role of Operations Workgroup a couple of months back. Right now, we’re tackling how we define operations in this new age and getting a jump on the challenges facing operations today. Some of these include new technologies, shifting operational roles, and streamlining and automating processes. In addition, customer preferences are changing as are delivery channels and the ecosystem of faster payments, which is transforming the face of faster money movement. You can read our latest update to get the scoop on our focused work efforts.

Beyond exploring internal operations, NEACH will continue to support you in staying on top of the emerging payments topics of significance to your FI. We expect to see a continued crescendo around faster payments, including RTP and FedNow, and a steady stream of emerging threats and opportunities from tech giants and newcomers alike.

To prepare for what’s next, consider exploring the Building Blocks of Payments Series and the Payments Professor NEACH Real Time Education for Real Time Payments 101 and NEACH RTP® Risks, Rules, & Regulations 201 programs to set plans for next year. In addition, look to NEACH for targeted new offerings in 2021.

With such a frenzy of activity in the last month, the industry’s certainly closing out this year with a bang, and we anticipate 2021 to bring more of the same. Now more than ever, payments strategies will be vital to addressing today’s needs and responding to tomorrow’s demands, and as FIs work to meet those expectations, internal operations will need to continue to evolve to become efficient, effective, and user-centric. In short, much change awaits us in the new year, but with it comes new opportunities. As you navigate this landscape, you can continue relying on NEACH to provide need-to-know updates on payments innovation and to support you in building toward the new payments paradigm.



Director, Payments Innovation

As the Director of Payments Innovation for NEACH, Mark focuses on exploring innovative solutions and technologies that will help position members for success, both now and in the future. Connect with Mark to read more of his blogs, articles, and posts.

Rate this article:
No rating
Comments (0)Number of views (1945)

Theme picker