Banks and credit unions no matter their sizes are now enabled to sign up and leverage the tool to instantly transfer money for their customers at any time of day and year. In the initial stage, 35 early adopting banks and credit unions, together with the U.S. Department of the Treasury's Bureau of the Fiscal Service, are ready with instant payments capabilities via the FedNow Service. Additionally, 16 service providers are prepared to support payment processing for banks and credit unions.
Based on the announcement information, when fully available, instant payments are thought to provide substantial benefits for consumers and businesses alike, exemplifying instances when expedited access to funds is useful, or when just-in-time payments help manage cash flows in bank accounts. Individuals can receive their paychecks instantly and use them the same day, and small businesses can manage cash flows in an increasingly efficient manner, free of processing delays. In the upcoming years, customers of banks and credit unions signing up for the service should be enabled to leverage their financial institution’s mobile app, website, and other interfaces to carry out instant payments quickly and securely.
Being an interbank payment system, the FedNow Service operates alongside other longstanding Federal Reserve payment services of the likes of Fedwire and FedACH. Per the press release, the Federal Reserve is committed to collaborating with over 9,000 banks and credit unions throughout the country to support the widespread availability of the service for their customers over time. Commenting on the launch, Federal Reserve Chair Jerome H. Powell advised that the Federal Reserve built the FedNow Service to assist with making everyday payments over the years to come increasingly fast and convenient. Per their statement, over time, as more banks choose to leverage the tool, the benefits to individuals and businesses alike will include enabling a person to receive a paycheck instantly, or a company to access funds instantly once an invoice is paid.
FedNow Service early adopters
A list of early adopters with instant payment capabilities, which includes financial institutions, settlement agents and liquidity providers, and certified service providers, together with additional information can be found on the Federal Reserve Financial Services website.
Concomitant with the Federal Reserve’s FedNow Service launch announcement, real-time payments software provider ACI Worldwide announced its readiness to support transaction activity for financial institutions on the instant payment rail. Additionally, ACI’s fraud protection services are available as part of its Real-Time Payments Cloud for US customers and featuring built-in integrated fraud protection, ACI supports connectivity to The Clearing House’s Real-Time Payments network and the FedNow Service alike.
US-based fintech Jack Henry also made public that it is supporting live transactions on the FedNow Service. Per their announcement, the Jack Henry faster payment Hub, JHA PayCenter, connects financial institutions to the FedNow Service, as well as the Zelle Network, and the RTP network. Additionally, the company has over 80 financial institution customers in varied implementation stages for the new service through the JHA PayCenter payments hub.
Fintech and regtech CSI, Computer Services, Inc. announced that its instant payment offering is live through the FedNow Service, having made enrolment available for its NuPoint and Meridian core platform customers in line with the FedNow Service launch. What is more, CSI has enrolled INB, N.A. in the modern payments network and encourages other financial institutions to enable real-time transactions that address account holder expectations.
Among the companies to have received certification readiness for the service, prior to the official launch, were the fintech platform Adyen, financial services tech company FIS, and financial software applications and marketplaces provider Finastra.
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