The US central bank, the FED, announced today that it has launched the FedNow service, a payment system that allows US citizens to send and receive money instantly, 24/7.
The system, called FedNow, allows consumers and businesses to send and receive money in seconds, 24×7.
With the implementation of the FedNow system, which has been working on since 2019, the USA has joined countries such as the European Union, the United Kingdom, India and Brazil, where similar services have been used for a long time.
Fed Chairman Jerome Powell stated the following in his statement on the subject:
“The Federal Reserve established the FedNow Service to help make day-to-day payments faster and more convenient for years to come.
Over time, as more banks choose to use this new tool, benefits to individuals and businesses will include ensuring that a person receives a paycheck immediately or that a company has instant access to funds when a bill is paid.”
It was stated that FedNow was launched with 41 banks and 15 service providers, including the largest US banks JP Morgan Chase, BNY Mellon, WellsFargo. The payment network is expected to expand further by the end of the year.
“We want our customers to take advantage of these capabilities and it's a competitive advantage for us,” said Carl Slabicki, global payments co-head of BNY Mellon Treasury Services, about the FedNoz service.