A couple months ago, the Federal Reserve Bank released Payment System Improvement – Public Consultation Paper, along with a survey and a request to the banking community/public to weigh in on strategic improvements in the US payment system.
They raise the question, should the Fed have a role in the improvement of the payment system, and what should that be? Should they be a catalyst for innovation?
The Fed is looking for answers, and as of Dec. 10, there were only 51 comments. How many banks are in the US? And only 51 have responded. Some may interpret this as apathy on the part of the banking community. Or, maybe they simply don’t have the answers – just more questions.
Why have the legacy payment systems lacked innovation?
Is it possible that bankers are caught between the cold, hard grip of regulation, the speed of innovation – and fear? While innovation is screaming along, the wheels of regulation turn very slowly. Maybe the Fed should be asking if the regulations, which are meant to protect, are doing a disservice. Perhaps there is a way to encourage innovation and even take it one step further – reward it. Imagine if all those uber smart, techy, Gen Yers wanted to work for a bank rather than the likes of Google.