The FedNowSM Service is a new instant payment platform the Federal Reserve Banks are launching in 2023 to provide financial institutions of every size, and in any location across the nation, access to safe and efficient instant payment services in real time, 24 hours a day.
Catalyst Corporate is a participant in the FedNow Service pilot program in 2022, as well as in the FedNow Service launch in 2023.
Through Catalyst Corporate's participation in the FedNow Service, credit union members and businesses will be able to send and receive instant payments conveniently, and recipients will have full access to funds immediately, giving them greater flexibility to manage their money and make time-sensitive payments. The service will act as a springboard to additional innovative instant payment services.
The initial FedNow Service launch will include:
- Core clearing and settlement capabilities to support a range of transaction types and use cases
- Use of the widely accepted ISO® 20022 standard and other industry best practices to support interoperability
- Features that will support flexible adoption, including support for the use of service providers and correspondents and an option to enroll as a “receive-only” participant
- Value-added features including request-for-payment capability and tools to support participants in their handling of payment inquiries, reconcilements and certain exceptions
- Features to enhance experience for credit unions by broadcasting participant availability to support their transition to 24x7x365 operations, a user interface to support data needs and the ability to have access to balance information on weekends
- Features to support payment integrity and data security and tools to help credit unions combat fraud, such as a transaction value limit and reporting features
- A liquidity-management tool that will allow participants and others to transfer funds to each other to support the liquidity needs of instant payments
After the initial service launch, additional features are planned related to user experience, error resolution and case management.