Visa will begin enabling faster delivery of money with Visa Direct, making funds transferred to U.S. bank accounts available within one minute.
This capability will begin in April 2025, allowing consumers, businesses and governments to use Visa Direct to deposit money to bank accounts linked to eligible debit cards in real time, the company said in a Thursday (Dec. 12) press release.
Visa Direct processes billions of real-time transactions in the United States, Jim Filice, vice president and head of real-time payments at Visa Direct, said in the release.
“This change underscores Visa’s commitment to accelerating real-time payments,” Filice said. “At Visa, we are constantly striving to innovate and provide the best possible money movement experiences, and this update will significantly enhance the speed and convenience, while maintaining strong security standards.”
The faster delivery of funds will apply to use cases like splitting a bill with friends, moving money between accounts, receiving an insurance claim payout, accessing earned wages, disbursing government benefits, processing healthcare payments and handling tips, according to the release.
The change will help organizations enhance operational efficiency, improve customers’ experiences and bolster trust among clients, per the release.
Visa’s move is a “significant step forward” in the development of faster payments, U.S. Faster Payments Council Executive Director and CEO Reed Luhtanen said in the release.
Sixty-eight percent of consumers would choose instant payments for all types of disbursements, when available, according to the PYMNTS Intelligence report “Disbursements Satisfaction Report 2023: Instant Payments Reach an Inflection Point.”
The report also found that 41% of consumers would be willing to pay a fee to receive this method of payment.
Visa reported in October that Visa Direct transactions grew by 38% in its fiscal fourth quarter to 2.8 billion and that the year’s total number of Visa Direct transactions reached almost 10 billion.
Real-time payments enabled by Visa Direct offer end users financial flexibility, Filice said in a June press release.
“Consumers expect a frictionless money movement experience,” he said.
The Consumer Financial Protection Bureau (CFPB) reportedly dropped a lawsuit against Comerica Bank that targeted the bank’s handling of a federal benefits program, alleging that it provided poor service to the recipients of benefits.
The Bureau told a U.S. District Court in a filing submitted Friday (April 11) that it was dismissing the suit, Reuters reported Friday.
The CFPB sued Comerica Bank in December, targeting the bank’s handling of the Direct Express program, which it had administered on behalf of the Department of the Treasury since 2008 and enables about 3.4 million federal beneficiaries to receive their monthly benefits payments through prepaid debit cards.
In its complaint, the CFPB alleged that Comerica Bank deliberately disconnected customer service calls, charged consumers illegal ATM fees, misled fraud victims, imposed illegal terms of service on consumers seeking to stop payments, failed to investigate account problems and forced consumers to close accounts to stop preauthorized payments.
“By deliberately disconnecting millions of calls and harvesting illegal junk fees, Comerica boosted its bottom line at the expense of Americans living on a fixed income,” then-CFPB Director Rohit Chopra said at the time in a press release.
Reached by PYMNTS on the day the lawsuit was announced, Comerica Bank said in an emailed statement that it would continue to defend its record as the financial agent for the Direct Express program and that it filed a lawsuit against the CFPB in November challenging the Bureau’s “regulatory overreach and its handling of this case.”
“Throughout the CFPB’s investigation, we have cooperated by sharing information and data to illustrate the unique nature of this program and the fact that we operate with the oversight of the Fiscal Service,” the statement said. “Despite our good faith efforts to provide this critical context, the CFPB has consistently ignored our arguments and documentation.”
It was reported in March that the CFPB asked a federal judge to pause the enforcement action that the agency filed against Comerica Bank.
CFPB Chief Legal Officer Mark Paoletta said in court papers that the agency was considering next steps and that the new CFPB leadership sought “time to review the matter,” Reuters reported March 3.
