Federal Reserve to Launch FedNow Service in July
Rockland Daily Staff
The Federal Reserve announced that the new FedNow Service will start operating in July and provided further details on Wednesday on preparations for the launch.
FedNow Service is being developed by the Federal Reserve Banks to facilitate the nationwide reach of instant payment services by financial institutions — regardless of size or geographic location — around the clock, every day of the year. Through financial institutions participating in the FedNow Service, businesses and individuals will be able to send and receive instant payments at any time of day. Recipients will have full access to funds immediately, giving them greater flexibility to manage their money and make time-sensitive payments. Access will be provided through the Federal Reserve's FedLine® network, serving more than 10,000 financial institutions directly or through their agents.
As of the first week of April, the Federal Reserve will begin the formal certification of participants for launching the service, which will accept live monetary transactions. This will only take place after certified participants conduct validation activities in June to confirm readiness for the July launch.
FedNow launch will enable every participating financial institution to offer a modern instant payment solution. Financial institutions and their industry partners have been advised to move forward with preparations to join the FedNow Service.
Growing the network of participating financial institutions will be key to increasing the availability of instant payments for consumers and businesses across the country.
"With the FedNow Service, the Federal Reserve is creating a leading-edge payments system that is resilient, adaptive, and accessible," says Tom Barkin, president of the Federal Reserve Bank of Richmond and FedNow Program executive sponsor in the Federal Reserve press release. "The launch reflects an important milestone in the journey to help financial institutions serve customer needs for instant payments to better support nearly every aspect of our economy."
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