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Newsletter
Evaluating the potential of immediate funds transfer for general-purpose payments in the United States
Immediate funds transfer (IFT) is a convenient, certain, secure, and low-cost means of electronically transferring money between bank accounts with no or minimal delay in receivers? receipt and use of funds. Yet IFT is not widely available in the U.S. This article summarizes discussions on the potential for IFT in the U.S. held at the Symposium on Immediate Funds Transfer for General-Purpose Payments, sponsored by the Federal Reserve Bank of Chicago, on September 7, 2011.
Newsletter
Developing a roadmap to improve the U.S. payment system
On October 22?23, 2012, the Chicago Fed hosted its 12th annual Payments Symposium, where industry leaders convened to evaluate the implications of recent technological changes for the payments industry, including the attendant rise in customer demand for faster, more convenient payment options that are safe and interoperable. Participants proposed a number of ideas that, taken together, could help foster the creation of a roadmap to unify the fragmented payments industry and ultimately improve the payment system.
Newsletter
Enhancing financial stability: the case of financial market utilities
The sweeping overhaul of the nation?s financial regulatory system that was signed into law on July 21, 2010, will touch virtually every aspect of financial markets. This Chicago Fed Letter focuses on provisions in the Dodd?Frank Wall Street Reform and Consumer Protection Act that affect ?financial market utilities,? critical behind-the-scenes institutions and arrangements that ensure the smooth functioning of financial markets.
Journal Article
Emergence of immediate funds transfer as a general-purpose means of payment
Immediate funds transfer (IFT) is a highly convenient, certain, secure, and economical means of payment using bank money. IFT is not available in the U.S. banking system, except for large-value business payments, interbank transfers, and specialized financial market transactions. This article examines the successful experience with IFT in Mexico, South Africa, Switzerland, and the UK and concludes that payment system governance is the principal barrier to IFT innovation in the U.S.
Journal Article
Are checks overused?
This study overturns the conclusion of a 1990 study by David Humphrey and Allen Berger, which found that check float is responsible for the popularity of checks despite their high resource cost compared to electronic payment instruments. The new study examines recent data on the costs of checks and automated clearinghouse (ACH) payments. It finds that the value of check float has decreased significantly since the 1990 study and is no longer large enough to make checks more attractive than ACH payments. The study also questions whether the idea that float could be responsible for the ...