Fed launches payment system FedNow

The US Federal Reserve (Fed) announced that its new system for instant payments, "FedNow", has been launched. In a statement from the Fed, it was reported that the bank has launched its new payment system, FedNow. The statement noted that banks and credit unions of all sizes can sign up for and use this system to instantly transfer money to their customers any day of the year, at any time of the day. It was stated in the statement that 35 banks and credit unions, as well as the US Treasury Department's Bureau of the Financial Service, currently use FedNow, and that 16 service providers are ready to support payment transactions for banks and credit unions. The statement stated that when the system is fully used, instant payments will provide significant benefits to consumers and businesses, individuals will be able to receive their paychecks instantly and use them the same day, and small businesses will be able to manage their cash flows more efficiently without transaction delays. Fed Chair Jerome Powell said in a statement on the subject, "The Fed created the FedNow service to help make daily payments faster and more convenient in the coming years." Powell said that over time, as more banks start using this new tool, individuals could receive their paychecks immediately or companies could have instant access to funds when their bills are paid. In 2019, the Fed announced that it would develop an instant payments service called FedNow to enable faster payments in the US.