Fed gets started on FedNow service to support instant payments

August 6, 2020 0 By boss

The Federal Reserve Board unveils details of the FedNow Service, a new 24x7x365 interbank settlement service with clearing functionality to support instant payments in the U.S.

The features and functionality are set out in a Federal Register notice based on input it received from the public after the Fed’s 2019 request for comment.

The service will start up in phases, with the first providing core clearing and settlement features to support market needs and help banks manage the transition to a 24-hour, 7-day-a-wee, 365-day-a-year services.

Based on ongoing stakeholder engagement, additional features and service enhancements will be introduced over time. 

Target launch date remains 2023 or 2024.

“The rapid expenditure of COVID emergency relief payments highlighted the critical importance of having a resilient instant payments infrastructure with nationwide reach, especially for households and small businesses with cash flow constraints,” said Federal Reserve Board Governor Lael Brainard.

Previously: Fed’s Brainard talks about forging a faster payment system (Oct. 3, 2018)

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