The Federal Reserve Board released details of its forthcoming FedNow real-time payments service, which it is seeking to launch in 2023 or 2024.
In a Federal Register notice and branding announcement, the Fed said it will take a phased approach to implementation, with the first release providing core clearing and settlement features to help banks manage the transition to a 24x7x365 service. Additional features will be introduced over time.
On a webinar, Fed Governor Lael Brainard said core features of the service will include fraud mitigation, a liquidity management tool to cover intraday overdrafts, and standards to support interoperability with private-sector payment services.
ICBA led a years-long campaign on behalf of Fed involvement in real-time payments and will continue working with the Fed as it develops and implements FedNow. It has called on the Fed to introduce the service as quickly as possible to maximize adoption among community banks.