Federal Reserve Banks and Equens team on cross-border payments processing

The Federal Reserve Banks and Equens have agreed a deal that will see them offer processing services to banks for payments between the US and Europe from early next year.

The partners have signed a memorandum of understanding on cross-border payments processing in multiple currencies, including the US dollar and euro.

Compared to domestic transactions, cross-border payments currently see relatively low volumes and high associated fixed costs.

The Federal Reserve Banks and Equens say their service will support banks in reducing their processing cost base, and strengthen their competitive position in the market.

Elizabeth McQuerry, assistant vice president, retail payments office, of the Federal Reserve Banks, says: "When talking with clients, we saw a clear demand for expanded payment services to and from Europe. Together with payment processor Equens, we can offer our clients an excellent, secure and cost-efficient solution."

Michael Steinbach, chairman, Equens, adds: "We are constantly looking for economies of scale, thereby creating opportunities for our clients - the banks - to further reduce their processing costs. By offering a standardised channel for cross-border payments processing, our clients do not have to worry about the complexity of maintaining different cross-border systems."