Welcome to Innovating Payments Top 3 News Headlines. According to survey findings released by the Association of Financial Professionals (AFP), 73% of organizations are transitioning their business-to-business payments from checks to digital payments. In other top headlines, the Federal Reserve released a "Synthetic Identity Mitigation Toolkit" to provide financial institutions, businesses, and consumers with insights and resources to fight synthetic identity fraud. And as reported by The Financial Brand, more than half of businesses (57% ) and consumers (58%) consider online account opening a "must-have" for any bank or credit union they use, according to the "2021 Banking Impact Report."
Read on to learn more.
1. Survey: 73% of Organizations are Transitioning their Business-to-Business Payments from Checks to Digital Payments (afponline.org)
Financial professionals are processing fewer checks; currently the median volume of checks processed is 500-999 per month compared to the 1000-1999 reported in 2015. Survey findings reveal median volume of ACH transactions have doubled in the last six years (1,000-1,999 per month versus 500-999). Median costs to issue and receive paper checks remain unchanged since 2015 at $2-$4 and $1-$2 per check respectively, while costs to initiate and receive ACH transactions are far less at $0.26-$0.50 per transaction. Read more.
2. Federal Reserve Releases Synthetic Identity Fraud Mitigation Toolkit to Educate, Fight Fraud (fedpaymentsimprovement.org)
The Federal Reserve today released a Synthetic Identity Fraud Mitigation Toolkit to provide financial institutions, consumers and businesses with an online repository of insights and resources on synthetic identity fraud. "Synthetic identity fraud, where fraudsters create an identity out of pieces of real and/or fictitious information, continues to grow and resulted in an estimated $20 billion in losses (Off-site) for U.S. financial institutions in 2020," said Jim Cunha, executive vice president, Federal Reserve Bank of Boston. Read more.
3. Why Omnichannel Account Opening is Crucial for Bank & Credit Union CX (thefinancialbrand.com)
If a financial institution's account opening process is overly complex, repetitive or prone to manual error, consumers and businesses will simply look elsewhere. As it stands, many competitors to community financial institutions such as neobanks and money-center banks are able to focus more of their effort and a larger budget on developing seamless digital banking experiences throughout the customer journey. (Read more.)
How does the knowledge that 73% of organizations are transitioning their business-to-business payments from checks to digital payments, impact your digital payments strategy? What steps is your organization taken to reduce synthetic identity fraud? How is business and consumer demand for online account opening affecting your digital payments strategy?
Check back in two weeks for our next issue, which will highlight the industry's most need-to-know developments. Visit us online at Innovating Payments for updates on these stories and more.
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.