1. Retail Payments Systems in the U.S. International Workshop Retail Payments Câmara Interbancária de Pagamentos São Paulo, Brazil June 1, 2007 James McKee Federal Reserve Retail Payments Office
5. Payments Markets Trends 0.00 2.00 4.00 6.00 8.00 10.00 12.00 2002 2003 2004 2005 2006 2007 2008 2009 2010 Cash Check Money Order Credit Card PIN-Less Debit Debit Card (Sig) ACH Source: Celent and BearingPoint Analysis Total Number of Consumer to Business Recurring Payments by Instrument (Billions) ACH Check WHILE USE OF CHECKS IS ON THE DECLINE, USE OF ACH IS ON THE RISE
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10. Check Processing/Clearing Flow Payee’s DFI Payor’s DFI FLOW : Payor (Maker), Payee (Party due payment), Payee’s DFI (Collecting bank), Clearing House, Payor’s DFI Federal Reserve Bank OR Correspondent Bank OR Local Clearing House Payee Company/Individual (Receives Check) Payor (Writes Check) Deposited Cancelled Forwarded Presented for Payment Payment through a debit to payment account Payment through a debit Payment through a credit Payment through a credit to payee’s account account
18. Present Day Who Is Using ACH? Consumers 143 Million Corporations 4.8 Million Federal Government Employees 99.8 Percent Private Sector Employees 71.0 Percent
27. New Entrants Growing Fast PayPal account growth continues (100 million+ accounts in 1Q06 & 40% annual transaction volume growth) along with service offerings (PayPal Mobile – Text to Buy) & international reach (55 countries)