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FedNow Is Live

federalreserve.gov

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Re: FedNow Is Live

#291

Post by H8crilA »

ArlenBales wrote: post #265

Question: Can this be used by a consumer to more conveniently and securely, and without 3rd party fees, sell things online or in-person? Example 1: Sell a graphics to someone on /r/hardwareswap. Currently using PayPal. Example 2: Sell car in-person. Currently go to bank and have buyer hand over cash to deposit in bank.

I hope so, when it trickles down to the commercial bank user level.

That's how it works in pretty much the entire rest of the world. PayPal is mostly incomprehensible to Europeans, it solves a problem that they never had.

Re: FedNow Is Live

#292

Post by isignal »

ishanjain28 wrote: post #123

Do they have a simpler use id like india's upi?(userHandle@bankHandle) In the demos I watched, There is account number and routing number

Yes, that part is unfortunate. It requires full routing number and account number. Maybe the phone number to account number mapping might be seen as a privacy risk in USA.

Re: FedNow Is Live

#293

Post by riskable »

piperswe wrote: post #257
atlgator wrote: post #165

Earlier quoted context omitted.

Like Apple photo scanning was basically just for CSAM detection, right?

What risks does FedNow have that FedACH doesn't have?

I know you're making a point but there is a distinct difference in risk: FedNow transactions happen instantly, therefore fraud can take place faster.

That's all though. That's not a good reason to stay on FedACH.

For the HN crowd the best way to describe the difference between FedACH and FedNow is migrating from a batch-based system that settled transactions a few times/day to a real-time system. Just like such migrations developers and engineers encounter in many normal IT environments, real-time systems have their own issues but are also capable of so much more and are generally easier to improve/evolve.

FedACH was made for big, one-time transfers between bank accounts where it wouldn't matter too much if settlement took a few days. FedNow was made for lots of small(er) instantaneous transactions.

At first FedNow will likely be used as a simple replacement for ACH transfers but I suspect that it will eventually replace the back ends that handle debit card payments (because the prize--which would be taken from Visa, MasterCard, First Data, and similar--is too big to ignore).

Re: FedNow Is Live

#294

Post by eweise »

uses wrote: post #166
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…

Currently this works between banks only. Banks have reserves at the Fed, and those reserves are what gets adjusted when a FedNow transaction happens. The banks then adjust their own records on their customers' behalf.

I think most if not all the participating banks are "receive only" so there's no one pushing any money yet.

Re: FedNow Is Live

#295

Post by tarmon »

foobarian wrote: post #282
uses wrote: post #166

Earlier quoted context omitted.

Currently this works between banks only. Banks have reserves at the Fed, and those reserves are what gets adjusted when a FedNow transaction happens. The banks then adjust their own records on their customers' behalf.

So it's like a Bitcoin exchange, but with dollars!

I don't see how this is anything like a crypto exchange, is there something I'm missing here?

Re: FedNow Is Live

#296

Post by efnx »

Here in NZ you can do this with your bank. Just enter the person’s acct number and the amount to send in online banking.

Re: FedNow Is Live

#297

Post by deathanatos »

From the FAQ,

> No. There is no FedNow app. The Federal Reserve does not provide payment services directly to consumers and businesses. Banks and credit unions can provide their customers with access to instant payments through new features

See y'all in another 25 years, when banks get around to implementing this.

Re: FedNow Is Live

#298

Post by HoyaSaxa »

For those curious, it is really using IBM MQ[1] under the hood and uses a bespoke flavor of the ISO 20022 specification.

The FedNow Service itself is the tip of the iceberg in terms of what actually happens from an end-to-end perspective.

We've been working to become a Certified Service Provider so feel free to ask me anything. I'm happy to share anything that is not under NDA.

[1] https://www.ibm.com/products/mq

Re: FedNow Is Live

#299

Post by umeshunni »

isignal wrote: post #278
wtmt wrote: post #252

This is a bit off topic for the post, but relevant for some of the comments here. For those who are commenting about payment systems in India and comparing this to UPI (Unified Payments Interface), this is not like UPI in a few ways. Firstly, this is more closer to a faster version of RTGS (Real Time Gross Settlement) in India, which is operated by the RBI (Reserve Bank of India). Speaking from experience, RTGS in In…

Another difference is the use of phone numbers and simple email like identifiers in UPI. That doesn’t seem to be part of FedNow itself. What makes UPI very usable is that entering the phone number or a simple UPI id brings up some metadata about the person to confirm that the transfer target is accurate. In FedNow such a layer has to be added by Zelle or similar layer above, it appears.

Well, given that FedNow has nothing to do with UPI, per the parent's comment, and it's about inter-bank settlement, it makes sense for an application layer like Zelle to provide that.

Re: FedNow Is Live

#300

Post by AmericanChopper »

foobarian wrote: post #282
uses wrote: post #166

Earlier quoted context omitted.

Currently this works between banks only. Banks have reserves at the Fed, and those reserves are what gets adjusted when a FedNow transaction happens. The banks then adjust their own records on their customers' behalf.

So it's like a Bitcoin exchange, but with dollars!

Some would say suspiciously so. Which is why some commentators think this is being implemented as a prerequisite of a CBDC.
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