The FedNow Service is set to launch in July 2023, and FinTech Automation announces its participation as a provider of enabling financial technology for payments processing.
The FedNow Service will be launched in stages beginning in July 2023, and FinTech Automation has announced that it has signed an agreement to be a provider of enabling financial technology for instant payment services on the platform.
Financial institutions of all sizes will be able to offer secure and reliable instant payment services thanks to the Federal Reserve’s new instant payment infrastructure, the FedNow Service. The service allows for instantaneous settlement of funds between participating financial institutions without the accumulation of interbank obligations or short-term credit risk.
FinTech Automation’s founder and CEO, David Park, stated: “One of our main objectives has been to assist banks, credit unions, and ODFIs in the introduction of new embedded finance solutions. For these financial institutions, being able to support secure instant payments through the FedNow System will be a real game-changer. Clients will be able to deploy this enabling technology quickly and without touching a line of code by using our platform.
With credit transfers finishing in a matter of seconds, the FedNow platform will provide core clearing and settlement capabilities, making instant payments accessible around-the-clock. Additionally, it offers 24/7 access to balance information as well as on-demand or evening access to activity reports. Financial institutions will also be able to settle using their own master account or a correspondent’s master account. Additionally, each routing transit number (RTN) enabled will include configurable features that will allow them to perform tasks like receiving customer transfers, sending and receiving customer transfers, receiving payment requests, supporting transfers related to liquidity management, and supporting settlement services for other financial institutions.
By utilising the FedNow Service, financial institutions can stay competitive, develop new financial products, and cater to the expanding demands of their clientele. As a result, the business clients of financial institutions will be able to better manage their cash flow, increase the effectiveness of corporate payments, and simplify their reconciliation procedures.
Account-to-account (A2A) transfers and bill payment are two examples of the functionality that will be supported by the FedNow Service’s first release.