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"For credit unions, access to faster payments services could help attract new members and improve overall satisfaction with services," wrote NAFCU's Andrew Morris in response to the Federal Reserve's proposal to develop a 24/7/365 real-time gross settlement (RTGS) service.

In October, the Federal Reserve released the proposal relating to a potential settlement service and liquidity management tool that could help address the future needs of a real-time retail payments environment. The proposal was issued during a NAFCU-attended forum with the FedPayments Improvement Community.

Morris, NAFCU's senior counsel for research and policy, said NAFCU worked closely with credit unions and other stakeholders to identify criteria and capabilities that would be beneficial in a future, faster payments system.

"A future payment system must be cost-effective, operationally effective, and scalable for credit unions of all sizes," Morris said. He added that the Fed should prioritize time to market and ubiquitous end-user adoption while designing the system.

Morris further outlined a number of considerations for the Fed, including expected demand, interoperability, liquidity management, fraud risk and more.

NAFCU has served on both the Fed's Faster Payments and Secure Payments Task Forces, which were formed as a part of the Fed's "Strategies for Improving the U.S. Payment System," since their inception in 2015. The conclusion of those task forces shifted the remaining payment improvement efforts to the FedPayments Improvement Community, of which NAFCU is a member.

NAFCU continues to be in constant communication with the Fed regarding its work to make the payments system faster and more secure and has met with Fed staff to discuss the strategy for achieving more secure payments. NAFCU has also urged the Fed to stay away from a "one size fits all" approach to the payment system's future. It will continue to represent the credit union industry's best interests in this process.

Morris' letter is available here.