The Federal Reserve System released a detailed vision Monday for improving the speed of the U.S. payment system.
It is the latest step in a process meant to spur change at a time when the country has fallen far behind many nations that have adopted real-time payments.
Payment industry insiders have long been awaiting the Fed's report, which is titled "Strategies for Improving the U.S. Payment System."
The report lays out four options for building a faster payment system: evolving the existing PIN debit infrastructure, which is currently used in retail stores and at ATMs, to enable real-time payments; using common protocols and standards to facilitate the clearing of transactions over the Internet; building a new payments infrastructure that would build on existing technology and only have limited uses; or building a new payments infrastructure that would process a wider range of transactions.
The report states that the four options will be studied further. The Fed said that early this year it plans to establish a task force on faster payments, which will get input from stakeholders, and then by 2016, identify one or more approaches for implementing faster payments.
A separate task force will be established to study payment-security issues.
Over the last few years, the Fed has been trying to walk a tightrope with respect to improving the U.S. payment system. The Fed wants to encourage the private sector to take a more forceful role in the effort, but it's also wary about being seen as overstepping its bounds.
During a conference call with reporters Monday, Fed staffers said that they see the new report as representing an increase in the Fed's role as a leader or catalyst for change. But at the same time, they said that the Fed will not step in and build its own new payment service unless the private sector cannot meet the need, and certain other criteria are met.
Fed officials pushed back against the idea that there is a lack of urgency in the U.S. payment industry about developing a faster system. They noted that The Clearing House, a group that is owned by many of the nation's largest banks, laid out its own vision for building a faster payment system late last year.
These officials also said that inside the Fed system, there is a strong sense of urgency on the issue of payment speed.