The US Federal Reserve has capped the time for the launch of its instant payment platform FedNow from May 5 to July 2023.
According to a press release, FedNow will be open to financial institutions of all sizes, allowing them to make instant payments to consumers and businesses, giving customers full and immediate access to funds. The platform is currently in beta with more than 120 participating institutions, including Bank of America and payment processing company Alacriti Payments.
First announced by then-Fed Governor (now Vice Chairman) Lael Brainard in August 2020, FedNow is seen as a stepping stone to a central bank digital currency (CBDC).
Ken Montgomery, executive director of the FedNow Service program, said in a Central Bank press release:
“The benefits of instant payments are increasingly important to consumers and businesses, and the ability to provide this service is critical for financial institutions.”