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.
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