This editorial was originally published on CU Insight
The FedNow® Service went live on July 20, 2023, and is accessible to depository institutions in the United States. As of this publication, there are 26 participating financial institutions. This service enables individuals and businesses to make instant payments through their depository institution accounts.
While it is undeniable that the Fed is a reputable and trustworthy entity, it's still important to be cautious and aware of potential inherent risks of any new technology, especially during the initial launch phase. You’ll need to be proactive in fraud mitigation and take responsibility for ensuring the safety and security of all payment processes. Staying vigilant and implementing robust security measures will help protect both your credit union and your members during this period.
“The Federal Reserve built the FedNow Service to help make everyday payments over the coming years faster and more convenient,” said Fed Chair Jerome Powell.
Here are some key points about the FedNow Service:
Real-time Clearing and Settlement: The service facilitates near real-time interbank clearing and settlement, allowing funds to be transferred from a sender's account to a receiver's account.
- 24x7x365 Operation: The service operates uninterrupted with a 24-hour business day every day, including weekends and holidays.
- Security and Data Integrity: The FedNow Service is designed with security features...
To learn more, keep reading here.