WASHINGTON–The Independent Community Bankers of America (ICBA) is calling on the Federal Reserve to accelerate implementation of its FedNow real-time payments service.
In a comment letter, ICBA said the Fed should provide more information to future users, engage stakeholders in developing the system, and work with private-sector providers to support a swift launch.
"While ICBA acknowledges the complexity and enormity of effort to create a new instant payment service, we also recognize the pressure resulting from the current environment where a private sector real-time network is already live and expanding its reach," ICBA wrote. "ICBA recommends proceeding to market with the service as soon as practically possible before the 2023 or 2024 implementation timeframe."
In its letter, ICBA praised the Fed's decision to develop FedNow, preserve choice in instant payments providers, and limit system access to banks eligible for Reserve Bank accounts. However, the agency's phased approach to introducing FedNow features over time hasn't sped up its expected introduction, the group said.
The Recommendations
The ICBA is calling on the Fed to:
- Expand transparency in the system's development by releasing more information to community banks and other users to plan for a swift and smooth launch.
- Engage with future FedNow users as part of the development process by including community banks in FedNow pilot programs, ensuring integration with core processors and digital banking vendors, and pursuing interoperability with The Clearing House's Real Time Payments Network.
- Ensure open and transparent rulemaking by following the usual notice and comment process and aligning rules with TCH's RTP network.