Dear Customer,

A warm welcome to our Spring newsletter. On this occasion, I want to focus on our recent Strategic Advisory Board (SAB) meeting where we discussed key payment market changes - and offer advice on these to ensure your architecture is fit-for-purpose.

Starting in the UK, the New Payments Architecture (NPA) is the re-platforming of the UK Faster Payments service. NPA will improve functionality and connectivity, with Scheme testing starting this year and migration occurring in 2025.

So, what do banks need to do ahead of NPA migration? Put simply, this will mean upgrading infrastructure, as old gateways will not support better functionality and connectivity associated with NPA.

To address NPA, Form3’s response includes building a new NPA gateway and developing new migration tools to help banks make the adoption switch. It is worth noting that, working with Form3 banks can effectively front-run the industry change and de-risk the NPA migration by moving existing Faster Payment traffic onto our platform and let us manage the migration behind the APIs .

In Europe, new legislation from the European Commission (EC) will mean that all credit institutions will have to offer SEPA Instant as a mandatory service to their customers. The predicted earliest go-live date for this is expected to be by the end of 2024. Also, the regulation effectively introduces a pricing control mechanism as SEPA real-time payments can no longer be more expensive than standard payments.

In the market today, there are banks that are not connected to SEPA at all, so this must be addressed. Other banks have made some progress on connectivity, but are not ready for scale or commercially viable - so this task must also be met over the next year.

With this new go-live date looming, Form3 has been engaging with banks to offer onboarding support and advice and we are considering providing screening services for both account list and transaction activity.

In the USA, FedNow, the Federal Reserve’s faster payment and instant payment scheme will go live in July. It is being rolled out as a competitor to The Clearing House Real-Time Payments offering (TCH RTP). In addition, Fedwire has an ISO 20022 migration on the horizon. 

For banks, FedNow means that a whole new gateway and payment system is coming online. Banks need to consider if and when they would like to invest in real time payments. For Fedwire ISO 20022 migration, banks will need to reevaluate whether their providers can offer resilient and reliable solutions to meet this challenge.

In response to FedNow, we are building out our services to enable more banks to connect to schemes. At the heart of what Form3 is offering are reliable, fast and simple solutions that can meet the needs of both faster payments schemes through one API.

In summary, the global payments landscape is changing. Form3 can help you with these changes, whether it is to provide new connectivity, manage migration or offer value-added services to take advantage of new functionality. We want to support you on your growth journey, by offering resilient and compliant advice and solutions.

Thank you for taking the time to read my introduction column.