The Federal Reserve’s long awaited real-time payments network FedNow launched this morning nearly four years after the rail was first announced.
As of today, 35 financial institutions who participated in FedNow pilot programs over the past several years can use the tool to transfer money around the clock, in real-time, according to today’s Federal Reserve release.
“Over time, as more banks choose to use this new tool, the benefits to individuals and businesses will include enabling a person to immediately receive a paycheck, or a company to instantly access funds when an invoice is paid,” Federal Reserve Chair Jerome Powell said in the release.
Pilot participants include U.S. Bank, Wells Fargo, JPMorgan Chase, BNY Mellon and 1st Source Bank, according to the Fed website.
Additionally, 16 service providers, including Fiserv, Finastra, FIS and ACI Worldwide, are ready to support the payments capabilities, according to the release.
Ahead of the launch, tech providers worked with bank clients to evaluate use cases, train staff, put the proper technology rails in place and assess risk, Gartner analyst Debbie Buckland previously told Bank Automation News.
Tech providers, including ACI Worldwide, have seen successful real-time payments rail launches in other countries, and this launch opens up 24/7/365 payments to U.S. consumers, Bridget Hall, leader of real-time payments at ACI Worldwide, told BAN.
As FedNow hits the market, faster payments will be just the beginning for FedNow capabilities, Hall said, noting that more use cases will surface post-launch.
“I don’t think we have unlocked all of the use case capabilities that this FedNow service can provide,” Hall said. “That’s the exciting part is we can help our customers be prepared to support these use cases as they come.”
