Is the U.S. ready for faster payments? According to a post on GovInfoSecurity.com, recent security problems with SWIFT, the global interbank messaging platform, have led some to wonder whether the move toward universal real-time payments needs to slow down.
In countries where real-time payments using bank-to-bank transfers are already being maintained by SWIFT – the Society for Worldwide Interbank Financial Telecommunication – major hacks have occurred. In February, $81 million was stolen from the central bank in Bangladesh following a malware attack on the SWIFT system.
Faster Payments Are Coming. Are They Bringing Faster Fraud?
Where the authentication process for bank-to-bank transfers is vulnerable, real-time transactions are amplifying the problem. Financial institutions typically have had several minutes or even a day to review transactions before processing them, but in a real-time environment the transactions fly. Worse still, once the transaction is made, the money is gone.
Meanwhile, real-time payments can’t happen quickly enough for consumers and businesses – many of whom already enjoy speedy payments via apps like Venmo and Square. CO-OP credit unions have the opportunity to participate in their own real-time payments network: RealPay. Using a real-time good funds model, RealPay – powered by the FIS PayNet network – bypasses the security issues that bank-to-bank transfers struggle with. For credit unions that don’t want to wait for bank-to-bank issues to work themselves out, RealPay is available now.
See what financial technology steps credit unions will need to take to keep up with the speed of transactions. Watch our video now to be ready for the face of future payments.