In a statement Thursday early morning, the Federal Reserve revealed that its instant payment system, the FedNow® Service, has actually officially gone live. This tool intends to empower banks and cooperative credit union of all sizes to help with instant cash transfers for their clients. The Federal Reserve declares that FedNow deals can be carried out 24/7, 365 days a year.
To start, 35 banks and cooperative credit union, together with the U.S. Department of the Treasury’s Bureau of the Fiscal Service, are amongst those currently geared up to manage payments through the FedNow Service. Furthermore, a lineup of 16 company are poised to use payment processing assistance for banks and cooperative credit union.
“The Federal Reserve built the FedNow Service to help make everyday payments over the coming years faster and more convenient,” stated Federal Reserve Chair Jerome Powell. “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.”
When asked if the FedNow service is trying to change money, and if it was a reserve bank digital currency (CBDC) or not, the Federal Reserve mentioned “No. The FedNow Service is not related to a digital currency. The FedNow Service is a payment service the Federal Reserve is making available for banks and credit unions to transfer funds for their customers. It is like other Federal Reserve payment services, such as Fedwire and FedACH. The FedNow Service is neither a form of currency nor a step toward eliminating any form of payment, including cash.”
A detailed list of early adopters currently geared up with instant payment abilities can be discovered in a connected file. Further details can be discovered on the Federal Reserve Financial Services site.
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