ARLINGTON, Va.—In response to the Federal Reserve's recent update on the FedNow Service, NAFCU told the Fed it needs to provide additional details about the program.
In the update, the Fed indicated the program will be launched in phases with a target release date of 2023 or 2024. However, NAFCU said its member credit unions have noted its future availability has positively affected plans for faster payment adoption.
"To sustain credit union interest and ensure that FedNow remains accessible to smaller, community institutions, the board should aim to provide additional clarity regarding certain statements in the service announcement that could significantly influence internal conversations regarding the suitability of FedNow as a platform for sending or receiving real time payments," wrote NAFCU Senior Counsel for Research and Policy Andrew Morris.
Morris reiterated the association's overall support of the program and several aspects of its planned launch as detailed in the service announcement, including the board's:
- Decision to prioritize the development of liquidity management and fraud prevention tools, as well as request for payment functionality as day-one features
- Commitment to conform the service's technical specifications to widely accepted industry standards in efforts to remove barriers to interoperability
Specific Pricing Info Sought
Morris also urged the board to provide specific pricing information "well in advance" of launching FedNow, noting that waiting until the launch could "delay cost recovery efforts and frustrate the board’s ultimate objective of providing real time payments to as many consumers as possible, including those in rural or underserved communities."
Additionally, Morris asked the board to clarify its rationale behind the revealed limits of the liquidity management tool and encouraged the board to make fraud prevention tools available to all users of Fed services.