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From the CEO
May 29, 2020

Dear Members:

Benefits of real-time payments

As you may already know, real-time payments offer many new benefits, not only for consumers but also for financial institutions. Some of these benefits include:

  • Data. The contextual data surrounding a payment has been missing from every previous payment system. Real-time payments offer the ability to attach information about the payment that doesn’t detach throughout the process, which will be helpful during payment processing and reconciliation.
  • Speed. The speed of real-time payments sets it apart, reducing payments from hours or minutes to seconds.
  • Immediacy. Real-time payments facilitate real-time authorization, real-time posting, and real-time clearing or settlement.
  • Requests. Unlike the other existing payments rails, real-time payments can facilitate a new request for payment (RFP), which allows a business or a consumer to send a request in the form of a message and provides the payor with the option to authorize or deny the payment. RFPs could be used in conjunction with bill pay or similar use cases.
  • Irrevocable. Real-time payments are irreversible, enabling immediate final settlement to the payee.

As a long-standing credit union payments partner, the goal of Corporate One’s faster payments strategic plan is to enable access and create opportunities for credit unions to take advantage of real-time payments. To that end, I’m excited to announce that both Corporate One and our CUSO, Sherpa Technologies, recently achieved two important milestones in our respective strategic initiatives on faster payments:

  • Corporate One became the first corporate credit union certified as a participant to receive payments via the The Clearing House’s (TCH) RTP® network.
  • Sherpa became the first credit union-specific, non-core, third-party service provider and CUSO to provide a hosted gateway to the RTP® network. This means Sherpa can now connect other credit unions to the Network.

I encourage you to read each announcement from Corporate One and Sherpa for more details. For now, I'd like to summarize what these achievements mean in the payments landscape and why they are important to the credit union industry overall.

The importance of real-time payments

Though the financial industry is still in the early stages of constructing a ubiquitous real-time payments market within the U.S., we believe it's important for Corporate One to be at the forefront of this payments shift, which is constantly being pushed forward by fintech providers, government players, and everyday consumers. Being a leader in this arena will allow us to help our member credit unions remain relevant and competitive partners to their own members. For example, of the more than 52% of U.S. accounts that currently reach the RTP network for real-time payments, less than 1% are at credit unions. But thanks to Corporate One’s recent certification and Sherpa’s proven ability to connect certified credit union industry entities to the RTP network, credit union access to the network is opening up.

The competitive landscape will be rife with fintech companies and large banks as real-time payments reach ubiquity, which is why we should be prepared to act rather than react with a credit union-driven solution. And our new capabilities have given us the footing to do just that, for the benefit of our members. The more we continue our leadership and expertise in the evolving payments landscape, the more we will be able to help our member credit unions introduce new products and services to meet their members’ real-time needs.

I’m excited about the opportunities ahead as the industry continues to move forward.

Melissa Ashley