VocaLink, the UK-based international payment systems provider, has signed a contract with The Clearing House (TCH) to develop a national real-time payment service in the U.S.
In October, the two companies announced they had signed a letter of intent, and today’s contract signing finalizes the partnership and clears the way for work to build the system to begin immediately.
Once complete, the system will be the most comprehensive real-time payment system ever developed. Not only will it empower U.S. consumers and businesses to send and receive real-time payments from their existing accounts at financial institutions, but it will also provide a platform to launch innovative new services that will power a new economy built around real-time payments. These services include new message capabilities for financial services that go well beyond basic payments.
With the contract now finalized, VocaLink has commenced work to ensure the system is built rapidly. In addition to the work TCH commissioned VocaLink to complete, individual financial institutions and their service providers have already commenced efforts to integrate and adopt the new real-time payment system.
The U.S. is the world’s largest payment market and this deal accelerates the move towards ubiquitous, real-time payments. To promote international interoperability and help ease cross-border commerce, the system will comply with global standards (ISO 20022) for real-time payments. Following the launch of this service, VocaLink technology will power major faster payments services in Europe, Asia and North America, including three of the four largest global financial centres. Europe has also begun the journey towards a pan-European instant payments service and VocaLink is engaging with many of the key stakeholders to share its experience and discuss potential solutions.
An effective partnership
VocaLink was selected by The Clearing House for its proven technology that includes many of the attributes desired by U.S. customers, its ability to upgrade its existing platform to provide additional innovative solutions, and its demonstrated speed to market. VocaLink implemented the UK Faster Payments Scheme in three years, and Singapore’s FAST payment scheme more rapidly. VocaLink designed, built and manage the real-time technology behind the UK Faster Payments Service on behalf of the Faster Payments Scheme. Since the service was launched in 2008, over four billion payments have been securely processed and the real-time infrastructure has provided a platform for further innovation, driving the development and proliferation of a wider range of services, including mobile payments. VocaLink’s experience in the design, development and delivery of real-time national payments infrastructure is second to none globally.
The Clearing House is the only private sector ACH and wire operator in the U.S., processing approximately 50% of all commercial ACH and wire volume in the U.S. Its customers include credit unions and commercial banks.
James Aramanda, President and Chief Executive Officer at The Clearing House said: “Finalizing this partnership with VocaLink represents a significant milestone in our effort to make ubiquitous real-time payments a reality in the U.S. Once completed, customers will pay or receive money in real-time from any financial institution, and with its innovative extensible design the system will be built to provide the basis for payment solutions currently unimagined.
“Most importantly, with VocaLink’s proven track record of rapid and effective development of real-time payments, The Clearing House and its owner banks will soon deliver access to the secure, real-time payments that customers in the U.S. desire.”
David Yates, Chief Executive Officer at VocaLink, commented: “This is an important deal for VocaLink and an important deal for the UK. The U.S. is the largest global payments market and to win this deal boosts the UK’s credentials as a global leader in payments technology.
“We look forward to working with such a respected and impressive partner as The Clearing House to deliver a service that will transform U.S. payments.
“We are committed to developing further partnerships around the world to build global, ubiquitous real-time payments.”