Welcome to the February 2025 issue of NEACH’s Innovating Payments Executive Summary—The Trump Administration Delivers on Crypto Promises. In his first week in office, President Trump issued an executive order, Strengthening American Leadership in Digital Financial Technology, delivering on crypto promises made during his campaign. In other news, “Treasury Secretary Scott Bessent gave representatives of the Department of Government Efficiency (DOGE) access to the federal payment system late Friday, January 31,” according to The New York Times.
Fiserv, Inc. announced on January 23 the appointment of Michael P. Lyons as President and CEO-elect, effective January 27, 2025. He will replace Frank Bisignano, who will continue as Chairman and CEO until June 30, 2025, or until confirmed by the U.S. Senate as Commissioner of the Social Security Administration.
Meanwhile, X CEO Linda Yaccarino announced that Visa is its first partner for the X Money Account, which will debut later this year. Additionally, the CFPB ordered Equifax to Pay $15 million for improperly investigating credit reporting errors. CFPB research reveals heavy Buy Now, Pay Later use among borrowers with high credit balances and multiple pay-in-four loans. Also, in this issue, the Green Sheet online reported why financial institutions should rethink their payments modernization strategy for their back offices.
Finally, registration is now open for NEACH’s Payments Management Conference, May 19-20, at the Foxwoods Resorts Casino in Ledyard, CT.
These stories are evolving rapidly. To stay abreast of the latest developments, check out NEACH’s be-weekly Top 3 news headlines posts, which you can find in Members Corner.
Read on to learn more.
Top News Headlines
Trump Delivers on Crypto Promises During First Week
On January 23, 2025, President Donald Trump issued an executive order, Strengthening American Leadership in Digital Financial Technology, delivering on crypto promises made during his campaign.
“The executive order called for a comprehensive draft of federal crypto regulations, as well as for first steps to be taken around exploring the creation of a national digital asset stockpile and the banning of central bank digital currencies (CBDCs),” reported PYMNTS.com.
Among the more crucial of the Trump administration’s recent crypto actions was the Thursday decision of the U.S. Securities and Exchange Commission (SEC) to rescind the Biden-era Staff Accounting Bulletin No. 122 (SAB 122), an accounting bulletin that required crypto custodians to record a safeguarding obligation, according to the news outlet.
The repeal of SAB 122, observers believe, will ultimately allow banks to interact more freely with the crypto sector.
Musk Given Access to the Treasury Payments System
Treasury Secretary Scott Bessent gave representatives of the Department of Government Efficiency (DOGE) access to the federal payment system late Friday, January 31, according to five people familiar with the change, the New York Times reported. “This gave Elon Musk and the team he is leading a powerful tool to monitor and potentially limit government spending.”
“The system, run by non-political staff, is also responsible for paying out tax credits for individuals and businesses, and, crucially, grants and payments to government contractors,” the Independent reported. “Some of those include organizations that compete with Musk’s companies.”
“Musk and his DOGE team ‘think the payment system should be overseen by political appointees selected by President Trump,’ according to the Wall Street Journal,” the Independent adds. “Now he has control of the payment system, which is a vital lifeline to millions of Americans.”
NEACH will provide updates on this story and how the industry responds as they unfold.
Fiserv Picks Michael Lyons to Replace CEO Bisignano
Fiserv, Inc. announced on January 23 the appointment of Michael P. Lyons as President and CEO-elect of Fiserv, effective January 27, 2025, according to a company news release. Lyons most recently served as president of The PNC Financial Services Group, where he led all of PNC’s business lines.
Lyons will report to Frank Bisignano, who will continue as Chairman and Chief Executive Officer until June 30, 2025, unless confirmed earlier by the U.S. Senate as Commissioner of the Social Security Administration. Upon Bisignano’s departure, Lyons will immediately step in as Chief Executive Officer of Fiserv and join the Fiserv Board of Directors.
“Mike Lyons is an exceptional leader who I’ve gotten to know well over the past 12 years as a client as we have partnered to deliver financial and payment solutions together,” Frank Bisignano, Chairman, President and Chief Executive Officer of Fiserv, said in the release. “His relentless work ethic, deep understanding of our business, and record of driving growth and quality make him an excellent choice to lead Fiserv through the next chapter. I look forward to working closely with him during this transition period.”
X Announces Visa as First Partner for X Money
Meanwhile, X CEO Linda Yaccarino announced on Tuesday, January 28, that Visa is its first partner for the X Money Account, which will debut later this year. According to Yaccarino, X Money will “allow secure and instant funding to your X Wallet via Visa Direct, connect to your debit card, allow person-to-person payments, and allow users to transfer funds to their bank accounts instantly.”
She added that this would be the “first of many big announcements about X Money this year.”
“X owner Elon Musk said in October 2023 that he expected X to transform into a payments super app,” according to PYMNTS.com. “When I say payments, I actually mean someone’s entire financial life…If it involves money, it’ll be on our platform.”
What’s Going on in Banking 2025
Cornerstone Advisors recently released its 2025 report, What’s Going on in Banking 2025: Happy(er) Days Are Here Again.
As reported by the company, key findings include:
- 80% of surveyed bankers are optimistic about 2025, fueled largely by the economy, industry dynamics, and the regulatory environment.
- Cost of funds top bank execs’ list of concerns for 2025. New member growth is the greatest concern for credit unions.
- Big fintech is viewed as the biggest threat by both banks and credit unions.
- In 2025, 28% of banks and 29% of credit unions plan to implement generative AI tools for the first time.
- Not one of the six core provider satisfaction attributes reached a 50% satisfaction level.
You can download a complimentary copy of the report here.
CFPB
CFPB Orders Equifax to Pay $15 Million for Improper Investigations of Credit Reporting Errors
On January 17, the Consumer Financial Protection Bureau (CFPB) took action against Equifax, the nationwide consumer reporting agency, for failing to conduct proper investigations of consumer disputes, according to a CFPB news release. Quoting the release: “The CFPB found Equifax ignored consumer documents and evidence submitted with disputes, allowed previously deleted inaccuracies to be reinserted into credit reports, provided confusing and conflicting letters to consumers about the results of its investigations, and used flawed software code which led to inaccurate consumer credit scores. The order requires Equifax to comply with federal law, and Equifax must pay a $15 million civil money penalty, which will be deposited into the CFPB’s victims relief fund.”
To learn more about the CFPB allegations, click here.
CFPB Research Reveals Heavy Buy Now, Pay Later Use Among Borrowers with High Credit Balances and Multiple Pay-in-Four Loans
The Consumer Financial Protection Bureau (CFPB) released a study of Buy Now, Pay Later (BNPL) borrowers, finding that more than one-fifth of consumers with a credit record used BNPL loans in 2022, with most of those consumers having subprime or deep subprime credit scores, according to a January 13 news release.
It goes on to say:
The CFPB research also revealed that over three-fifths of BNPL borrowers held multiple simultaneous BNPL loans at some point during the year, and one-third had loans from multiple providers. BNPL borrowers were also more likely than other consumers to have higher balances on other unsecured credit lines, such as credit cards.
To better understand the emerging BNPL market, the CFPB issued market monitoring orders in March 2023 to collect information from several companies offering no-interest, pay-in-four BNPL loans, including Affirm, Afterpay, Klarna, Paypal, Sezzle, and Zip. The CFPB matched the loan level and deidentified consumer information it received with consumer credit records to study the prevalence of BNPL use.
For information on these findings, click here.
Miscellaneous
JetBlue now Accepts Venmo for Online Bookings
“JetBlue announced on January 21 that it is the first airline to accept Venmo, an easy and secure payment option for booking flights directly with JetBlue online,” according to a company news release. “Currently available on jetblue.com and rolling out on the JetBlue mobile app in the coming months, U.S. customers can conveniently purchase flights using their Venmo balance or linked bank accounts, debit cards, or credit cards when booking travel.”
“We’re continually looking for ways to make it easier to book a JetBlue flight on our website and mobile app,” said Carol Clements, Chief Digital and Technology Officer, JetBlue, in the release. She added, “Venmo offers a seamless payment option for customers who enjoy the ease and convenience of the Venmo platform.”
Companies are Rethinking the Payments Back-Office
Financial services companies are racing to adopt new payment rails, channels, and innovations. Still, according to the January 13 issue of The Green Sheet Online Edition, they may be missing a critical piece of the bigger picture—their payments back office.
Without a modern and efficient back-office, the whole operation falls behind, which can lead to regulatory and financial issues, Joyce Mehlman, Founder of iLEX Consulting Group, said in the article.
These inefficiencies lead to reduced productivity and increased labor costs, with maintenance expenses for legacy systems expected to rise by eight percent annually and projected to reach $57 billion by 2028, says the IDC Financial Insights info brief, Future Ready Payments Platforms Enabling the Next Phase of Growth for Banks.
Click here to learn more about this topic and the key benefits of back-office modernization. Visit NEACH U’s School of Payments Modernization to learn more about this topic.
NEACH
It’s just February, but this year is already shaping up to be a wild ride in payments. Join NEACH for its May 19-20 Payments Management Conference at the Foxwoods Resorts Casino in Ledyard, CT, to discuss the latest payments trends and how they apply to your organization.
Click here to register and the pre-conference workshop.
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AUTHOR: Joe Casali, AAP, NCP
Executive Vice President
As the EVP of Payments Innovation for NEACH, Joe focuses on exploring innovative solutions and technologies that will help position members for success, both now and in the future. Connect with Joe to read more of his blogs, articles, and posts.
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