Can the Visa-Mastercard duopoly be broken?

> FedNow is an instant payment service for both individuals and businesses. Once launched, the initial transaction limit will be $25,000. This means that FedNow be more useful for small businesses and retail payment needs until it is widely adopted and the transaction limit grows.

> In early 2022, the Federal Reserve released pricing and fee details for their real-time settlement network. Because FedNow is government-operated, it’s mandated to break even and not turn a profit. A possible advantage of this is that FedNow may offer more competitive pricing than other payment systems, which encourages widespread adoption at a faster rate.

Merchants can pass the CC surcharge through; I’d expect them to do so when a very low cost immediate settlement option is available. This will allow consumers to self select if they want the benefits of paying with a credit card (but paying for the privilege). Credit can be extended if needed by a financial institution, without using CC rails. Net 30? BNPL? Special financing arrangement? Pick your poison either prior to or after value transfer has occurred. The innovation is utility priced financial infrastructure, cutting out the rentseekers mentioned.

(my note: it’s about five cents per FedNow value transfer transaction)