Core provider Jack Henry has launched a person-to-person (P2P), open-loop payment solution that allows the transfer of money regardless of whether a transaction takes place on the same network. 

The real-time payment solution gives customers a way to use their local bank to send and receive funds, allowing smaller financial institutions (FIs) to compete with larger banks, Tede Forman, president of payment solutions at Jack Henry, told Bank Automation News.

“Part of our strategy is to have solutions that can help the community financial institutions compete out in today’s world against the big banks and the fintechs,” Forman said. “Giving consumers choices really helps keep the community financial institutions in the game, versus forcing them down a specific closed-loop network.”  

Powered by cloud-native payments platform Payrailz — which Jack Henry acquired in September — the solution can be offered in conjunction with Zelle or The Clearing House’s real-time payment (RTP) network, he said. The API-driven solution gives customers the ability to send funds using a recipient’s email address or mobile number, Forman added. 

Fraud mitigation capabilities were built into the solution using machine learning and artificial intelligence to help verify recipients’ identities, according to a release. The solution uses one-time passwords, and a fraud monitor is currently in development to “score 100% of P2P payments in real time,” the release said. 

The offering continues a trend of Jack Henry’s previously announced partnerships with community FIs, including MVB Bank, to compete with larger banks by allowing additional options for sending and receiving payments. 

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