Federal Reserve Planned Actions

The Federal Reserve Board has announced that the Federal Reserve Banks will build and operate the FedNowSM Service, a new interbank 24x7x365 real-time gross settlement (RTGS) service with integrated clearing functionality to support faster payments in the United States. The decision to develop the new RTGS service (Off-site)  was based on an assessment of public input and policy criteria regarding the Federal Reserve’s role in the payment system. Watch Governor Lael Brainard’s speech announcing the Federal Reserve’s planned actions above or read her written remarks (Off-site).

The FedNow Service is intended to advance public policy goals for faster payments and to help support the modernization of the nation’s payment capabilities. To accomplish these goals, the FedNow Service will enable 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.

The Federal Reserve will also 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 change.

Expanded hours for existing settlement services, in combination with a new settlement service for faster payments, would represent a modernization of Federal Reserve payment and settlement services and strengthening of the U.S. payment system. The Board is requesting public comment on the FedNow Service via a second Federal Register notice.

Interested in learning more about the planned service features, as outlined in the Federal Register notice, and how you can provide input? Read the Board’s frequently asked questions (off-site) and sign up for a webinar!

Overview of the Settlement Assessment

Last fall, after taking into consideration requests from stakeholders, the Board requested comment on potential actions the Federal Reserve could take to facilitate interbank settlement of faster payments. In response, the Board received more than 400 comment letters from a wide variety of stakeholders in the U.S. payment system, including financial institutions, individuals, consumer organizations, merchants, service providers, private-sector operators, fintech companies and trade organizations.

We received more than 350 comments on a Federal Reserve faster payment service, representing nearly 800 organizations. Fully 90% of these comments called for the Federal Reserve to operate a real-time service for faster payments.

FedNow Service Description

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

On August 15, the Federal Reserve System announced in a press release that First Vice President Kenneth C. Montgomery will lead the development of the new FedNow Service.

Role of the Fed in the Faster Payments Transformation

The Federal Reserve is committed to its mission to foster the accessibility, safety and efficiency of the nation’s payment system. Providing payment services, often in 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 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 regs.comments@federalreserve.gov 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

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