In a new white paper released today, BAFT, ABA’s global transaction banking subsidiary, recommended several steps to create a faster cross-border payments ecosystem. The paper was developed by BAFT’s Cross-Border Faster Payments Working Group as part of a broader strategy to encourage the designers of national and regional faster payments systems to include cross-border faster payments capabilities at the outset.
“Baseline standards and processes must be established to address the open issues that make real progress on cross-border faster payments difficult to attain,” said BAFT SVP Samantha Pelosi. “These issues fall into three broad categories of interoperability, business processes and compliance, and are similar to the frictions that the Financial Stability Board and Committee on Payments and Market Infrastructures have identified as inherent to all cross-border payments.”
Among other things, BAFT called for the establishment of an advisory committee to recommend best practices for global operation of the cross-border faster payments ecosystem, common international operating standards and the use of a single communications network.
To accelerate progress on a cross-border faster payments ecosystem, BAFT said that conflicting national anti-money laundering and sanctions regulations need to be addressed, as well as underlying infrastructure that was not designed to facilitate cross-border payments.