The Federal Reserve banks are planning to launch the FedNow Service sometime between May and July 2023.
This new timeframe comes as the FedNow Pilot Program enters technical testing for the service starting in September. Currently, approximately 120 organizations are participating in the FedNow Pilot Program. When it is up and running, it will be accessible to financial institutions of any size in any geographic location.
“Today, with the FedNow launch date in sight, we are pleased with the collaboration and dedication our pilot participants have brought to advance modern payments in America,” Esther George, president and CEO of the Federal Reserve Bank of Kansas City and executive sponsor of the FedNow program, said.
The FedNow Service is being developed to facilitate the nationwide reach of instant payment services by financial institutions around the clock every day of the year. This means that businesses and individuals can send and receive instant payments at any time, while recipients will have full access to funds immediately. Access will be provided through the Federal Reserve’s FedLine network, which serves more than 10,000 financial institutions directly or through their agents.
“The benefits of instant payments are increasingly important to consumers and businesses, and the ability to provide this service will be critical for financial institutions to remain competitive,” said Ken Montgomery, Federal Reserve Bank of Boston’s first vice president and FedNow Service program executive. “Next year, financial institutions will be able to use the FedNow Service as a springboard to provide innovative solutions to their customers.”
Participants in the FedNow Pilot Program will complete a certification process to ensure operational and messaging readiness. Then they will move into production once the service is launched.