Mexico is waiting for the U.S. and Canada to grab hold of real-time payment capabilities so money can flow between its borders faster, reports said on Wednesday (Sept. 28).
Director of Payment Systems at Banco de México Miguel Díaz Díaz recently spoke at the SWIFT Sibos conference being held this week and told his U.S. and Canadian peers that Mexico is ready when they are to exchange real-time payments.
But according to Sean Rodriguez, Federal Reserve Banks SVP and faster payments strategy leader, the U.S., at least, may need some time.
“It’s a bit of a messy place in the U.S. these days,” he said at the event, according to reports. The market is filled with new FinTech entrants and already has tens of thousands of deposit-taking institutions, he said. With many players continuing to depend on legacy payment rails, like wires and ACH, the industry will need time to integrate real-time payments technology on a mass scale.
“We took on an effort four to five years ago to start to consult with the industry,” said Rodriguez. “What resulted from all this dialogue was a strategy paper which was issued in 2015.”
That paper is helping to inform the Fed’s Faster Payments Task Force, he added, with players agreeing on a set of goals focused on payments security, speed and cross-border capabilities. According to Rodriguez, part of the challenge in having the country adopt faster payments is the fact that it is extremely unlikely Congress will issue a faster payments mandate, unlike mandates seen in other countries.
“We don’t think we will get activity that will be right for the country by that mechanism,” Rodriguez said of the lack of a possible government mandate, “so we will use collaboration.”
Rodriguez and Diaz spoke on the panel alongside Payments Canada CEO and CFO Gerry Gaetz, reports added.