Town Hall: Getting Up to Speed on FedNow
With the new instant payments service launching in July, Terry Wright from the Federal Reserve Bank of Richmond shared what to expect with credit unions at Tuesday’s Town Hall hosted by the MD|DC Credit Union Association.
Wright said when FedNow goes live this summer the U.S. Treasury Department will be one of approximately 50 early adopters. According to the Federal Reserve, the first new payment rail introduced since the 1970s will allow financial institutions of every size to provide safe and efficient transfer, clearing and settlement of funds in real time, 24 hours a day.
For credit unions considering participating in FedNow, Wright has this advice, “Talk to your processor to see if they are ready, or when they will be ready to start.” He also encouraged credit unions to initially sign up for receive-only participation. Wright says the FedNow Service will include a liquidity management tool to cover payment activity along with fraud prevention tools.
The Federal Reserve hopes that widespread adoption of the FedNow service, specifically by smaller regional financial institutions, will make instant payments more accessible to everyone.
For more information on FedNow, visit: explore.fednow.org
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