How to Implement
Guidance
Design the Inclusive IPS for overall value and attractiveness.
A payment system is expected to do more than simple clearing and settlement, providing broader functionality such as an alias directory or fraud detection, to DFSPs and may even add value to the transaction by supporting bill payment or developing a cross-border Scheme. The Scheme can provide these services efficiently to all participating DFSPs.
Provide fraud mitigation tools.
The Scheme provides fraud mitigation tools in its platform and additionally develops other valuable fraud mitigation solutions, such as a catalog of fraud typologies, confirmation of payee, a safe alias addressing approach, efforts to simplify the complaints and resolution process, etc.
Make available a shared fraud utility.
The Scheme provides a shared fraud utility tool to support DFSPs’ transaction monitoring activities.
Collaborate to develop typologies catalog.
The Scheme leads or participates in collaborative efforts to define and evolve a fraud typologies catalog. The catalog is made available to DFSPs for use in transaction screening.
Enable bad actors list.
The Scheme provides DFSPs with the capability to submit a list of bad actors, accounts linked to previous confirmed fraudulent or suspicious activity, which allows the Scheme to screen transactions against the list, to reject any that trigger the list, and to share the list with DFSPs to flag accounts owned by the bad actor.
Provide cross-border capabilities to all DFSPs as a Shared Service.
Cross-border capabilities are available to all DFSPs as an optional, Shared Service.
Why It Matters
This takes advantage of economies of scale to reduce payment system costs, enhance security, maintain consistent quality across participants, and ensure a seamless user experience, making the Inclusive IPS more affordable and efficient.
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Fraud Mitigation
A shared investment in fraud mitigation tools can be particularly helpful in preventing fraud occurrences across the ecosystem. To comply with regulations and adhere to Scheme rules, DFSPs rely on a myriad of fraud mitigation tools and this may be very costly. Investment in tools by the Inclusive IPS can help reduce the cost of fraud risk mitigation for individual DFSPs and the ecosystem.
Cross-Border
Cross-border payments require additional effort relative to domestic payments, with unique considerations for Scheme rules, legal agreements and regulatory alignment, technical connections, compliance, and settlement. The cost of these efforts is not affordable for most DFSPs on their own but is attainable when the Scheme enables cross-border payments and can share in the expense of providing these functionalities with and among participants. Harmonization efforts are vastly simplified when carried out at the Scheme level and all DFSPs are operating on the same norms and procedures.
Related Resources
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