Innovating Payments Top 3 Headlines (Feb. 5, 2023)

Welcome to Innovating Payments Top 3 News Headlines for the Week of Feb. 5, 2023. In this week's headlines, ACH Network volume increased in the fourth quarter as Same Day ACH Value soared 87.5%. Meanwhile, ISO 20022 adoption is underway, but not without its challenges. With ISO 20022 quickly becoming the global standard, financial institutions should act now to prepare for imminent changes. With fraud on the upswing, financial institutions are looking for ways to mitigate risk. According to this week's headlines, digital ID and Know Your Customer (KYC) practices and processes are an excellent place to start.

Read on to learn more.

1. ACH Network Volume Increases in Fourth Quarter as Same Day ACH Value Soars 87.5% (Nacha)

The ACH Network continued growing in the final quarter of 2022. Payment volume totaled 7.6 billion, up 2.3% from the fourth quarter of 2021. The value of those payments, $19.4 trillion, is a 3% rise. Use of Same Day ACH remained solid following the March 2022 increase in the per payment maximum to $1 million. In the fourth quarter, $503.3 billion in same-day payments moved safely and swiftly along the modern ACH Network, an 87.5% increase from a year earlier. (Read more.)

2.  ISO 20022 Adoption Is Underway, but Not Without Challenges (Payments Journal)

Heralded as one of the most challenging adoptions within the payments ecosystem, ISO 20022 aims to make payments more effective for markets, banks, and customers globally. ISO 20022 is defined as an open global standard for electronic data interchange between financial institutions. As a global standard, it uses a common language to both send and exchange payment data, enhancing the current interface within companies, payment schemes, and financial institutions worldwide. Using consistent information leads to more efficient payment processes. (Read more.

3.    Digital ID and KYC Platforms Potent Weapons Against Accounts Receivable Fraud (PYMNTS)
As noted here last month, financial institutions (FIs) were fined nearly $5 billion for anti-money laundering (AML) violations, breaches of sanctions and flaws in know-your-customer (KYC) systems last year. That's up 50% from 2021. Incoming payments and accounts receivable processes are a key point of vulnerability for banks and for enterprises in general. The "customer" - the individual or enterprise holding the bank account or contacting B2B customers - might not be who they say they are. Hacks and social engineering wind up making it difficult to effectively guard against fraud and money laundering. (Read more.)

Do you see a similar surge in Same Day ACH volume? Where does your financial institution stand with ISO 20022 adoption? Are there challenges you're facing that NEACH could better support you in? Finally, how is your financial institution using digital IDs and KYC to mitigate risk?

Check back soon for our next issue, highlighting the industry's most pressing and need-to-know developments. Until then, visit us online at Innovating Payments.

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