The Federal Reserve Banks plan to roll out an instant payments service between May and July of 2023.
“The FedNow Service will transform the way everyday payments are made throughout the economy, bringing substantial gains to households and businesses through the ability to send instant payments at any time on any day, and the funds being immediately available to recipients to make other payments or manage cash flow efficiently,” Lael Brainard, vice chair of the Board of Governors of the Federal Reserve System, said in a statement published Monday.
Over 120 organizations are taking part in the pilot program of FedNow Service, which is set to transition to the technical testing phase in mid-September.
These organizations include U.S. Bank, Exchange Bank, Alacriti Payments, ECS Fin, Form3 and ModusBox.
Pilot program participants will undergo a certification process and then transition to the production phase upon launch of the service. The Federal Reserve is tapping non-pilot service providers and financial institutions that will serve as early adopters of the FedNow Service.