New payments infrastructure continues to gain traction with financial service providers looking to modernize their services for business clients.
In the U.S., The Clearing House's RTP finds expansion within the community bank arena, while abroad, the Bank of Thailand is planning its own infrastructure development to accelerate B2B payments. And when it comes to legacy rails, the U.S. Federal Reserve has introduced a new effort to combat payments fraud.
PYMNTS explores these stories and others in this week's Payment Rail Innovation Tracker.
RTP Gains Community Bank Traction
In a sign that RTP adoption is now spreading beyond the biggest banks, Chesapeake Bank, based in Virginia, has looped into The Clearing House's Real-Time Payments (RTP) network. In an announcement made last week, the community bank said the integration will support customers that seek "new functionality" from their banking service providers, according to Chief Information Officer DJ Seeterlin, who added that customers "need financial technology tools that align with their personal and business needs."
"Supporting real-time payments through the RTP network is an important step for us," he continued. "We are proud to be an early adopter of the RTP network, which demonstrates our commitment to be at the forefront of technology and payments and allows Chesapeake Bank to continue to meet our customers' needs now and in the future."
HSBC Debuts Real-Time Direct Debit
In Hong Kong, HSBC introduced an application programming interface (API) to facilitate real-time direct debit for their corporate customers. Business clients of HSBC Hong Kong can integrate instant electronic Direct Debit Authorization (eDDA) within their own systems to support real-time funds transfer, the bank said, without requiring those businesses to separately log in to their banking portals and set up direct debit instructions. The API supports setup, verification and initiation of direct debit, with the bank's head of global liquidity and cash management Yvonne Yiu pointing to the cash management benefits such a tool could bring to businesses.
"Designed to allow our corporate customers to stay ahead of the evolving demands of their clientele, this innovative cash management API also supports businesses in their digital transformation and daily operation optimization," she stated.
Bank Of Thailand Readies New Infrastructure
The Bank of Thailand is readying to commence work on new infrastructure aimed at streamlining financial transactions for the business sector, it recently announced. According to the announcement, the Bank of Thailand is planning to use central bank digital currency (CBDC) to support funds transfer, with an eye on accelerating supplier payments as an early use-case of the payment system.
First to test the infrastructure will be Siam Cement Public Company, which will adopt the technology for its procurement and supplier payments operations. The Bank of Thailand said it will begin development next month and aims to complete it by the end of the year.
Federal Reserve Tackles Fraud Across Rails
Emerging payment rails and digital currencies often tout security as a key value-added differentiator over legacy payment rails. Indeed, the risks of fraud on legacy rails continues to be a focus for payments industry stakeholders, and the Federal Reserve has just introduced a new resources designed to mitigate that risk.
Dubbed the FraudClassifer model, the initiative includes a set of tools and resources for payment service providers, corporates and other industry stakeholders to understand fraud across ACH, wire and check payments. The solution supports the need to classify fraud independently of payment type or other payment characteristic.
"It can be applied across an organization to help ensure greater internal consistency in fraud classification, more robust information and better fraud tracking," said Jim Cunha, Federal Reserve Bank of Boston secure payments strategy leader and senior vice president, in a statement.