The US Federal Reserve last week released a new paper that outlines the next steps that it will employ, in collaboration with industry, to make further progress in U.S. payment system improvements.

This follows the central bank’s “Strategies for Improving the U.S. Payment System” paper, released in January 2015, which represented the first steps in the payments improvement journey. The paper called for the commitment of all stakeholders to achieve five desired outcomes focused on speed, security, efficiency, international payments, and collaboration.

The Fed also convened a Faster Payments Task Force in May 2015. In January 2017, the task force released the first of its two-part final report that described its approach and articulated its views on the value of faster payments for addressing stakeholder needs. The second part, released in late July 2017, included a number of proposals to leverage blockchain technology for faster payments.

In the recently issued paper “Federal Reserve Next Steps in the Payments Improvement Journey”, the bank noted that while its efforts, in conjunction with those of the task force, have driven good progress toward achieving the desired outcome, private sector providers have moved to design, and in some cases, introduce faster payment capabilities to end users. It said:

“The payments industry also has begun exploring potential uses of digital currency and distributed ledger technology in delivering faster payment solutions.”

The Federal Reserve outlined the next steps for faster payments in the U.S., which includes supporting an interim collaboration work group established by the task force, Pursuing Federal Reserve settlement services that address the future needs of a ubiquitous real-time retail payments environment, and exploring and assessing the need, if any, for Federal Reserve engagement as a service provider, beyond providing settlement services. It added:

“In addition to these three tactics, the Federal Reserve will consider other enhancements to its existing services and will continue to monitor, study and solicit input from stakeholders to understand the implications of new payment technologies and models, including distributed ledger technologies and digital currencies, that can facilitate a safe and efficient U.S. payment system.”

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