Payments channels are constantly evolving and expanding, with real-time functionality quickly becoming a reality for thousands of financial institutions and millions of consumers, including members of our most forward-thinking credit unions.
Helping to drive that expansion is the launch of The Clearing House RTP network, now well underway, and next year’s pilot of the much-anticipated FedNowSMService.
Credit unions are understandably eager to offer real-time payments, but also need to understand that enterprise-level fraud systems built for ACH and wire transfers cannot be expected to easily ramp up to the rigorous demands of protecting real-time cash movement.
Alacriti, a provider of a wide range of digital payments solutions, doesn’t believe that should be a barrier to adopting real-time service.
Here, Al Griffin, Alacriti’s principal solutions consultant and payments practice lead, explains how his company will help member-owned financial cooperatives turn challenge into opportunity as they adopt the real-time payments functionality that may soon become a must-have in today’s ultra-competitive financial services marketplace.
While a very large part of preventing real-time payments fraud is member education, additional technology is required to prevent fraud. This includes real-time artificial intelligence (AI) learning, rule technologies, and real-time communication with members.
Please describe Alacriti’s plans for helping credit unions secure real-time payments.
Al Griffin:While a very large part of preventing real-time payments fraud is member education, additional technology is required to prevent fraud. This includes real-time artificial intelligence (AI) learning, rule technologies, and real-time communication with members.
We’ll be partnering with an anti-fraud organization to create a bespoke solution that can be implemented alongside the connection to real-time payments rail. That solution will augment credit unions’ current fraud systems.
How does Alacriti currently serve credit unions with payment solutions?
AG:Alacriti is a leading payments fintech dedicated to helping credit unions compete with challenger banks and digital wallets by transforming their payments experience. We offer seamless, real-time money-movement experiences such as loan pay, A2A transfers, digital disbursements, and bill pay.
Alacriti also connects credit unions to The Clearing House RTP network, Fedwire, ACH, Visa Direct, and the FedNow Service on a single platform. Everything is cloud-native and ISO 20022-based, eliminating the need to overhaul legacy infrastructure or significant upfront investment.
Do you currently offer real-time payment rails?
AG:Yes. Cosmos Payments automates payments through initiation and settlement, enabling credit unions to unify payment processing into one system for TCH’s RTP network, ACH, the Fedwire Funds Service, Visa Direct, and soon, the FedNow service when it goes live next year.
Cosmos can help credit unions accelerate the adoption of new technology, simplify payments operations, and grow their businesses by consolidating all payment types on one platform.
How does the risk profile for real-time payments differ from that for ACH and wire transactions?
AG:The big differentiator is the amount of time you have to preview transactions for potential fraud. With wires and ACH, you can use standard offerings that allow you more time to review before sending them out. RTP transactions settle within a matter of seconds. Thus, the key element is proactive fraud detection.
What kinds of fraud attacks are you seeing the most now?
AG:The majority of attacks are account-takeover related. FIs should begin taking a deeper look into account and user validation with real-time payments.
How is Alacriti preparing to augment credit unions’ current fraud systems?
AG:Alacriti has built the infrastructure for a real-time, proactive fraud-detection solution while also partnering with a world-class, globally trusted fraud service provider to provide the proper analytics for a faster, more accurate fraud detection scheme.
What will this partnership provide your credit union clients?
AG:The Alacriti system will combine a model consisting of data points from multiple credit unions and other FIs that use AI and machine learning techniques to quickly analyze and score potential transactions. This will provide credit unions an edge in proactively reducing the number of fraudulent transactions before they occur.
Our system will also provide the reports and transaction analysis that credit unions need to effectively manage their regulatory requests in addition to internal evaluations and audits.
Al Griffin, Principal Solutions Consultant/Payments Practice Lead, Alacriti
What is the differentiator between the Alacriti solution and competitive anti-fraud solutions?
AG:The Alacriti solution will focus on real-time payment activity and, in addition, share output to the credit union’s existing enterprise fraud system to enhance fraud detection in their other, non-real-time payment rails, such as ACH and wires.
How can credit unions learn more about Alacriti and your payments solutions?
AG:Go to www.alacriti.com. To speak with an Alacriti payments expert, please contact usat (908) 791-2916 or info@alacriti.com.
