Welcome to 2018!
I trust your new year is off to a good and productive start.
Mercator Advisory Group has a full schedule of reports in the Debit and
Alternative Products Advisory Service based on topics clients are telling us
are important to them and with an emphasis on data, including projections
regarding accounts, dollars transacted, and transactions.
The annual debit outlook for the new year, which considers how market forces
may impact debit and alternative products is available through this link. Also, my colleagues and I conducted a
webinar in which we each discussed our respective areas of expertise,
providing a full view of where the payments industry is headed in the near
term. Subscribers to Mercator’s advisory services can listen to a recording
of that webinar here.
The report agenda:
I will kick off the
year with a report on the state of faster payments in the U.S. that includes
projections on the growth of faster payments in person-to-person, consumer-to
business, business-to-consumer, and business-to-business (P2P, C2B, B2C, and
B2B) segments to help readers size up the opportunity. A portion of the
report looks at the growth in same day ACH. Same day is not a real-time
payment, but it is a faster payment and it is important to consider alongside
payments that do in fact message, post, and settle in a matter of seconds.
Same day ACH (SDA) may take some opportunities away from real time payments
in situations where ACH is fast enough, the features of ACH fit the need, and
where the price for same day ACH is attractive.
Financial institutions that aren’t already offering SDA origination services
are gearing up to launch services in 2018, which necessitates a critical look
at sign-up criteria and security. We are also seeing evidence of rising
interest among businesses in certain niche markets looking at push payments
like Mastercard Send and Visa Direct in products such as B2C disbursements.
For those businesses with significant B2C distributions, the ability to reach
anyone who has a Mastercard or Visa branded card, eliminate the need to
capture and maintain checking account details, and reduce the manual aspects
of processing paper checks is a measurable benefit.
Also in 2018, we will get a better perspective on how the Fed’s continued
role in real time payments. They have stated their intention to build a real
time settlement capability, but they have also left the door open to build a
real time payments service themselves should they not see the market moving
quickly enough towards a ubiquitous offering. A Fed offering may be a
welcomed addition to smaller financial institutions wondering how they can
support the implementation of a new payment type to their current