Two years ago the Federal Reserve released Strategies for Improving the US Payment System, a plan that was intended to improve the payment system by making it faster, more secure and more efficient. Since this plan was released, the Fed has collaborated with key stakeholders to implement strategies from the plan to ensure that the US payment system keeps up with the fast changing requirements of American consumers and businesses.
The five strategies outlined in the plan include: 1) Stakeholder Engagement, 2) Faster Payments, 3) Payment Security, 4) Payment Efficiency, and Enhanced Federal Reserve Services. In its January 2017 progress report, the Fed describes what has been accomplished in each area and what he next steps are.
Since its beginning, the plan has generated a great amount of attention and responses from the FinTech industry. A number of payment technology providers are currently working with the Fed to implement its strategies.
According to the Wall Street Journal, these supporters are not limited to large corporations. Startups are also “trying to get in on the act”. Dwolla Inc., a small software provider that focuses on helping companies make transactions directly with banks, has proposed collaboration plan to the Fed. The company hopes that under the leadership of the fed, the industry can work together to “build a system more fair and open than the previous systems, which were created behind closed doors”.
With the boom of proposals for technological advancement and a promotion of public interest, we can expect an exciting year ahead for the Fintech industry. For example, a London-based mortgage Fintech, has raised £5.5 million on January 23rd, 2017. Press releases commented that this signals that Fintech has finally arrived in the mortgage industry. As technology keeps bringing changes and challenges into traditional banking, the capital-raise environment is likely to be more open and friendly for startups in the field.