FedNow
FedNow is the Federal Reserve's instant payment service, launched in 2023, enabling financial institutions to offer real-time payment capabilities to customers 24/7/365.
FedNow launched in July 2023, giving the Federal Reserve a direct role in real-time payments alongside The Clearing House's RTP network. FedNow enables instant credit transfers between participating financial institutions with irrevocable settlement.
FedNow is available to any Federal Reserve member institution — giving community banks and credit unions a path to real-time payment capability without going through The Clearing House's ownership structure. This is meaningful for smaller FIs that had less direct access to RTP.
For embedded finance programs, FedNow represents an additional real-time rail alongside RTP — expanding the reach of instant payments to institutions that weren't on RTP. Programs designed for real-time disbursements, instant supplier payments, or speed-premium payment experiences need to account for both networks.
Key difference from RTP: FedNow is operated by the Federal Reserve; RTP is operated by The Clearing House (owned by major banks). Current transaction limit: $500K (lower than RTP's $10M). Both networks are growing in adoption.