Welcome to The Top 3 Innovating Payments Headlines for the week of June 11. Federal bank regulatory agencies issued final joint guidance to help financial institutions manage risks associated with third-party relationships. Also in the news, Assistant Secretary for Financial Institutions Graham Steele delivered remarks on digitizing financial services at the Transform Payments USA conference in Austin, Texas. Finally, learn what wider adoption of real-time payments means for financial institutions.
Read on to learn more:
1. Agencies Issue Final Guidance on Third-Party Risk Management (The Federal Reserve)
Federal bank regulatory agencies today issued final joint guidance designed to help banking organizations manage risks associated with third-party relationships, including relationships with financial technology companies. The final guidance describes principles and considerations for banking organizations' risk management of third-party relationships. The final guidance covers risk management practices for the stages in the life cycle of third-party relationships: planning, due diligence and third-party selection, contract negotiation, ongoing monitoring, and termination. (Read more.)
2. Remarks by Assistant Secretary for Financial Institutions Graham Steele on the Digitization of Financial Services at the Transform Payments USA 2023 Conference (U.S. Department of the Treasury)
Today, Assistant Secretary for Financial Institutions Graham Steele delivered remarks at the Transform Payments USA conference in Austin, Texas, on the digitization of financial services . . . Prepared Remarks: As the Assistant Secretary for Financial Institutions, I am responsible for the Treasury's policy views on matters affecting banks, credit unions, insurance, consumer protection, access to capital, and financial sector cybersecurity. The discussions at Transform Payments USA reflect the larger, decades-long trend of the digitization of financial services. (Read more.)
3. What Wider Adoption of Real-Time Payments Means for Financial Services (Forbes)
As of June 2022, 41% of U.S. businesses use real-time payments, according to a report from PYMNTS and Mastercard. One of the key drivers of real-time payments in the U.S. has been the real-time payments (RTP) network, a private service launched by The Clearing House in 2017 that is used by many larger financial institutions to transfer funds. In July, an RTP competitor will launch in the form of FedNow(S.M.): the Federal Reserve Bank's new offering for real-time payments. (Read more.)
How can your financial institution better align its risk management practices with the nature and risk profile of your third-party relationships? What is your financial institution doing to leverage new opportunities sparked by digital expansion? The promise of faster payments will likely draw more U.S. businesses to the FedNow network. How can your financial institution capitalize on new opportunities in the business sector?
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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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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