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FedNow Is Live

federalreserve.gov

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Re: FedNow Is Live

#211

Post by lisper »

cameldrv wrote: post #191
lisper wrote: post #15

Earlier quoted context omitted.

> Is this akin to government-backed Venmo, or something? Yes, exactly. But you have to keep in mind that this is a two-edged sword. On the one hand, it's going to be convenient and probably secure. On the other hand, it's going to let the government see every transaction you make, which for some people will be a very high price to pay.

I don't see how this is much different than the current situation. The Fed already processes ACH transactions (basically all bill-pay, most transfers to/from Paypal/Venmo etc), and all wire transfers (most high dollar money transfers)

The new system is faster.

Re: FedNow Is Live

#212

Post by tiffanyh »

TechBro8615 wrote: post #192
2143 wrote: post #179

Funny thing about topics like this is that people of any given country is oblivious to how other countries have solved that problem, or the challenges other countries face, or inturn the problems that they themselves face. Regarding payment systems specifically, people generally don't realize what they're missing. Pick anybody from anywhere and they'll tell you they've been able to do everything they ever wanted to d…

Sure, but in most countries, those services are provided by banks, not the government. There is certainly something to be said for legislation like open banking regulations that encourages/forces banks to facilitate instant peer to peer payments. But that's a far cry from a service offered directly from the government (okay, technically the fed isn't the government, but it may as well be).

Sounds like a European view.

Re: FedNow Is Live

#213

Post by ianburrell »

jabroni_salad wrote: post #173
thomas_ma wrote: post #156

How can a consumer actually try this to send money? This says Wells Fargo is live now but after logging into Wells Fargo I don't see any obvious new feature.

Think of it more as an alternative method to fulfill the kinds of things that ACH and Wire Transfers are used for. You'll probably never see 'this is a fednow function' on any consumer facing documentation, but billpay, payroll etc will use it.

I'm assuming that banks and payment services will add it to their services. Everything that goes over ACH will gradually switch to FedNow. There will be no noticeable difference to users except that transfer will be instantaneous instead of taking days.

Re: FedNow Is Live

#214

Post by lxgr »

TechBro8615 wrote: post #192
2143 wrote: post #179

Funny thing about topics like this is that people of any given country is oblivious to how other countries have solved that problem, or the challenges other countries face, or inturn the problems that they themselves face. Regarding payment systems specifically, people generally don't realize what they're missing. Pick anybody from anywhere and they'll tell you they've been able to do everything they ever wanted to d…

Sure, but in most countries, those services are provided by banks, not the government. There is certainly something to be said for legislation like open banking regulations that encourages/forces banks to facilitate instant peer to peer payments. But that's a far cry from a service offered directly from the government (okay, technically the fed isn't the government, but it may as well be).

Interbank payment systems are actually provided by central banks or the government (or affiliated organizations of either) in quite a few cases.

Europe has TIPS (an ECB-operated implementation of the SEPA Instant Credit Transfer scheme), India has UPI (which is pretty close to the central bank, as far as I understand) etc.

In the case of FedNow and TIPS, there are private alternatives as well, such as RTP in the US or EBA Clearing's SEPA Instant implementation in Europe. This is similar to ACH – there's both a public (FedACH) and a private (The Clearing House) implementation/network available.

Re: FedNow Is Live

#215

Post by rabidonrails »

tracker1 wrote: post #185
rowls66 wrote: post #169

Earlier quoted context omitted.

Shameless plug, but Moov offers a single API for payments. The clearing house's RTP system will be supported shortly, and FedNow is coming soon after. Check out out here: https://moov.io/

Pricing page is all but worthless... no indication what so ever about what even basic tier pricing is, or could be.

Agreed. This is really strange from their pricing page: >> Get started for free to test our APIs & unblock your development team. Talk to us about your transaction volume to get the best pricing with flexibility to grow.

You would think there would _at least_ be a ceiling price. Makes me wonder why they can't show _any_ pricing.

Re: FedNow Is Live

#216

Post by genmud »

jonhohle wrote: post #197
CameronNemo wrote: post #182

Earlier quoted context omitted.

Two points of context: * the Biden administration is planning to monitor smaller denomination transactions (in an inflationary environment!) * IRS resources historically and presently target low-income, low-wealth households/individuals for audits https://www.cnbc.com/select/irs-600-reporting-rule-delayed/ https://www.cbsnews.com/news/irs-audit-eitc-five-times-as-li...

What benefit would targeting low wealth individuals have to the IRS? I worked on a state tax system briefly at Accenture and they offered the product for a percentage of reclaimed taxes. They started with high debts with good credit scores. Since they had skin in the game (which it could be argued the IRS doesn’t), they wanted to maximize the unpaid taxes they collected.

Because wealthier people have more complicated returns and are much more likely to litigate, resulting in more time commitment.

For high net wealth audits, you could have potentially dozens of people working on it for years so there is a possibility that a judge / jury rules in your favor.

They are going after low effort people, but making it up by volume.

Re: FedNow Is Live

#217

Post by tiffanyh »

no_wizard wrote: post #96

Is there going to be a universal SDK / API we can use with this? This would cut alot of middle companies out of the payments industry (or at least put pressure on lowering fees). That would be a huge win. Wish we could do the same for the credit card companies. Would be great if the Federal Government could intervene in some way to have Visa / Mastercard / American Express / Discover use the same API interface for pa…

> Wish we could do the same for the credit card companies.

For e-commerce, isn’t that SRC?

https://www.emvco.com/emv-technologies/secure-remote-commerc...

Re: FedNow Is Live

#218

Post by finfrastrcuture »

panarky wrote: post #100

The press release lists a few big banks like Chase, Wells Fargo, BNY Mellon, US Bank and Fiserv, along with a dog's breakfast of random service providers and credit unions. Since free realtime payments presumably would still require both the sender and the receiver to use a participating financial institution, instead of all participants just transacting directly through the Fed, how is this supposed to work if most…

the entire reason FedNow exists is because (simplifying somewhat) the large banks launched their own real-time payments system (RTP through the Clearing House) and small banks in the US lobbied the govt HARD to get a government option out of the reasonable concern they would get squeezed by the majors.

nearly all banks in the US should support FedNow within the next few years, if not much sooner, as it is seen as tablestakes for most bankers.

Re: FedNow Is Live

#219

Post by jrmg »

orf wrote: post #207
aketchum wrote: post #204

Earlier quoted context omitted.

I assume you are being snippy, but to actually answer the question: Kinda - if you are paid on Fridays then payroll is submitted on Tuesday or Wednesday.

No I’m genuinely asking. You get paid at the end of the month, but it actually arrives in your bank 4 or 5 days later?

Yes. Or the entity doing the payment initiates it a few days earlier to ensure timely arrival.

Re: FedNow Is Live

#220

Post by imtringued »

JumpCrisscross wrote: post #106
no_wizard wrote: post #96

Is there going to be a universal SDK / API we can use with this? This would cut alot of middle companies out of the payments industry (or at least put pressure on lowering fees). That would be a huge win. Wish we could do the same for the credit card companies. Would be great if the Federal Government could intervene in some way to have Visa / Mastercard / American Express / Discover use the same API interface for pa…

> Is there going to be a universal SDK / API we can use with this? There is probably a neobank opportunity in providing this. FedNow is, reasonably, administered by banks. (The Fed doesn't want to provide end-user customer service nor incur liability for fraud.)

Isn't this column's whole shtick?
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