Chicago Fed Official Tapped to Lead Payments Reform Effort

The Federal Reserve Board on Friday announced the appointment of a senior official at the Federal Reserve Bank of Chicago to lead the central bank’s efforts to improve the national payments system.

Gordon Werkema, the Chicago Fed’s chief operating officer, will be put in charge of overseeing reforms outlined in the Fed’s “Strategies for Improving the U.S. Payment System” paper unveiled in January.

“With his extensive background in payments and his leadership of the Federal Reserve’s customer relationship management office for the past 15 years, Gordon was the clear choice to lead these payment system improvement efforts, which center on stakeholder collaboration,” Esther George, president of the Federal Reserve Bank of Kansas and chief sponsor of the payments initiative, said in a press release.

Werkema began his career at the San Francisco Federal Reserve Bank in 1981, later moving to the Chicago Fed where he serves as first vice chairman and chief operating officer. Werkema’s responsibilities include overseeing financial management, information technology, payments and other personnel management duties.

The Fed in January outlined a detailed strategy for improving the U.S. payment system, which is frequently criticized for being too slow for modern commerce and lagging far behind other countries, particularly in Europe. The paper laid out four possible strategies for speeding up payments. They include relying more on PIN debit infrastructure, instituting a common framework for clearing payments online, building a new payments infrastructure on top of existing processes or starting over from scratch.

Banks, meanwhile, moved earlier this month to require counterparties to accept same-day Automated Clearing House transactions, which before had been optional. The Fed followed suit, putting out for public comment a proposal requiring member banks to accept those same-day transactions.