The "FedNow" service will seek to eliminate the several-day lag it commonly takes cash transfers to settle, bringing the U.S. in line with countries including the United Kingdom, India, Brazil, as well as the European Union, where similar services have existed for years. Unlike peer-to-peer payments services like Venmo or PayPal, which act as intermediaries between banks, payments made via FedNow will settle directly in central bank accounts.
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Fed launches long-awaited instant payments service, modernizing system
"For us, FedNow really is a wonderful way of expanding reach," said Anu Somani, head of global payables and embedded payments at U.S. Bank.
