Payments giant FIS saw dozens of bank customers looking to join FedNow as the adoption of real-time payments grew in the third quarter. 

“We are encouraged by the interest we are seeing related to the rollout of FedNow,” Chief Executive Stephanie Ferris said during the company’s Q3 earnings call today. “We currently have over 190 clients in our pipeline, up from 116 clients just last quarter.”

BNY Mellon, JPMorgan and Citizens Bank are among 170 banks that are live on FedNow as of Nov. 6, according to the Federal Reserve Bank’s website. 

BIGGER PICTURE: FIS industry peers, including Fiserv and ACI Worldwide, are also experiencing a rise in interest in real-time payments options among their customers. 

“I know that a lot of people are interested in FedNow,” ACI Worldwide Chief Executive Tom Warsop said during the company’s Q3 earnings call last week. “What we are seeing is a significant pipeline of financial institutions that are coming on board to be ready to handle FedNow transactions.” 

While volume on FedNow is low, the industry expects it to tick up slowly as more FIs join the network, Warsop said. 

BY THE NUMBERS: In Q3, FIS reported; 

• Revenue of $3.7 billion, up 3% year over year; 
• Revenue from banking at $1.8 billion, up 3% YoY; and 
• Net loss of $449 million, compared with net profit of $249 million in Q3 2022. 

NOTEWORTHY: FIS is seeing an increased demand for its banking solutions digital deposit features from financial institutions as it tries to increase customer deposits, Ferris said. 

“It’s not necessarily new, although it’s definitely heightened,” Ferris said. “We’re seeing a lot of demand for that, and we caught out a couple of those wins this quarter.” 

For example, BMO launched a digital savings platform with FIS in Q3 while neobank, Jenius Bank, a wholly owned subsidiary of $1.9 trillion Sumitomo Mitsui Financial Group, launched a deposit account for its customers, Ferris said. 

FORWARD LOOK: FIS is on track to close the partial sale of WorldPay to GTCR in Q1 2024 and expects operating expenses to fall in the coming quarters on the heels of the sale, Ferris said. 

MARKET REACTION: Shares of FIS [NYSE: FIS] were down 1.20% from market open to $51.10 as of market close today. FIS has a market capitalization of $29.84 billion.