MFIC To Collaborate with Federal Reserve Banks to Enhance FEDGlobal ACH Payments
The New “Account-to-Receiver” Service will enable financial institutions to attract new customers, advance financial integration of the unbanked immigrants
April 27, 2010 (Washington, DC) Microfinance International Corporation (MFIC) is collaborating with the Federal Reserve Banks (FED) to enhance FedGlobal SM ACH Payments, cross-border payment service to US depository institutions. The newly launched “account-to-receiver” service will allow funds from accounts at a U.S. depository financial institution to be retrieved by unbanked receivers at either a bank location or at a trusted, third-party provider in 10 Latin American countries. MFIC uses ARIAS, MFIC’s money transfer platform, to help FedGlobal expand its offering beyond Mexico, where the FED delivers the service through Mexico’s central bank.
The new feature is one of various improvements that the FED has introduced to its cross-border payment service since last September, keeping with the FED’s responsibility for making the payments system more efficient and effective. This service provides financial institutions with an opportunity to attract new customers. It also provides a lower cost remittance option for immigrants which should help them feel more comfortable with banks.
Atsumasa Tochisako, President and CEO of MFIC, noted “It is our pleasure to contribute to an initiative which will fulfill our mission to increase access to financial services and offer an attractive business opportunity for banks. I am convinced that ARIAS is a good solution for the Federal Reserve and US banks because of its wide distribution network, strong compliance and state-of-the-art processing technology.” As a highly customizable platform, ARIAS is a viable solution to not only depository institutions, but also bankers’ banks and payment providers. ARIAS is an integral part of MFIC’s mission of improving access to finance among the unbanked worldwide.
The U.S. originates more than $110 billion in individual remittances annually, according to an estimate by an industry expert. Because financial system are underdeveloped in some countries that receive large amounts of remittances, a majority of recipients lack a bank account and thus prefer to collect money in cash. The “account-to-receiver” feature dramatically improves the ability of financial institutions to bank remittance senders while being able to send funds back home to family members without bank accounts.
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