The Board of Governors of the Federal Reserve System announced on August 5 that the Federal Reserve Banks will build and operate the FedNowSM Service (Off-site), a new interbank 24x7x365 real-time gross settlement (RTGS) service with integrated clearing functionality to support faster payments in the United States. The decision came after an in-depth policy analysis, including the assessment of more than 400 public comments (Off-site) on an RTGS proposal outlined in last fall’s Federal Register notice. The Board is now seeking public comments on all aspects of the FedNow Service through the latest Federal Register notice.

Additionally, the Federal Reserve will explore the expansion of Fedwire® Funds Service and National Settlement Service hours, up to 24x7x365. Subject to the outcome of additional risk, operational and policy analysis, the Board will seek public comment separately on this potential action.

Watch Governor Lael Brainard’s speech announcing the Federal Reserve’s planned actions below or read her written remarks (Off-site).

How will the service work?

In a society that operates on a 24x7x365 basis, where you can instant message and post and consume content online at any time, faster payments have the potential to bring positive benefits to the U.S. economy. Real-time payments allow individuals and businesses to send and receive payments any time, any day, anywhere, and within seconds, have full access to those funds. The FedNow Service will support interbank settlement for financial institutions’ provision of end-to-end faster payment services and, in combination with private-sector real-time payment services, provide infrastructure to promote ubiquitous, safe and efficient faster payments in the United States. Features under consideration for the FedNow Service include:

  • Processing individual credit transfers valued at $25,000 or less in real time (within seconds) on a 24x7x365 basis
  • Settling payments through debits and credits to balances in financial institutions’ master accounts at the Reserve Banks, with an end-of-day balance recorded for each day of the week
  • Providing liquidity through intraday credit on a 24x7x365 basis under the same terms and conditions as for current Federal Reserve services
  • Adhering to the ISO® 20022 standard and providing access through FedLine® connections
  • Allowing participating financial institutions to designate a service provider to submit or receive payment instructions on their behalf and settle payments in the account of a correspondent bank

Why does the Federal Reserve need to enter the market?

The Federal Reserve is committed to its mission to foster the accessibility, safety and efficiency of the nation’s payment system. Providing payment services, along with collaboration and cooperation with the private sector, is a key part of our ability to affect public policy objectives and achieve those goals for the benefit of the U.S. public. The Federal Reserve views support for faster payments as requiring modernization of, and upgrades to, Reserve Bank services alongside private-sector services, and broader modernization of the banking industry as a whole. Similar considerations have led central banks in various countries to develop modernized settlement infrastructures to support faster payments.

The FedNow Service can help create, alongside the private sector, an accessible, safe and efficient RTGS infrastructure for faster payments. The Federal Reserve has a uniquely broad reach as a payment services provider to more than 10,000 financial institutions across the country. This broad access can prove especially important for reaching customers of financial institutions in rural communities who often rely upon their local banks and credit unions to access financial services.

How can I comment?

The Board is seeking feedback through November 7, 2019. All comments will be posted to the Board website without alteration except when necessary for technical reasons or to remove sensitive personally identifying information. We encourage you to provide comments via the following options:

  • Board website: Follow the instructions for submitting or viewing comments on the Proposals for Comment (Off-site) page
  • Email: Send an email to and include the docket number, OP-1670, in the subject line
  • Fax: (202) 452-3819
  • Mail: Ann E. Misback, Secretary, Board of Governors of the Federal Reserve System, 20th Street and Constitution Avenue, N.W., Washington, DC 20551

Where can I learn more?

The Federal Reserve Banks will host webinars during the comment period to provide an overview of the notice and answer questions. Visit (Off-site) to learn more about the Board’s decision.


“ISO” is a registered service mark of the International Organization for Standardization.