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FedNow Is Live

federalreserve.gov

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Re: FedNow Is Live

#681

Post by TulliusCicero »

astrange wrote: post #677
TulliusCicero wrote: post #664

Earlier quoted context omitted.

No, US bank to bank transfers/payments are quite slow, and not commonly used for small transactions. But there are a couple substitutes that are used: * Zelle is basically better bank transfers and is already supported by many (most?) US banks: https://en.wikipedia.org/wiki/Zelle_(payment_service) * Random 'third party' money transfer services like Venmo, Cashapp, Paypal, etc. But similar to messaging in the US, the…

Debit cards can be used for instant payments and are used to eg pay Uber drivers. Or wire transfers. And Zelle is a bank to bank transfer network, not a third party service.

> And Zelle is a bank to bank transfer network, not a third party service.

That's...what I said? Well, I guess I should've contrasted it better with the old, 'traditional' bank transfer payments.

Re: FedNow Is Live

#682

Post by astrange »

mistrial9 wrote: post #558
seany wrote: post #526

Earlier quoted context omitted.

> threat models This is exactly the thing you _shouldn't_ put under NDA. What on earth?

guess -- knowing the currently discussed threat models is a competitive advantage for the dozen fintech security firms that are in on this, and a "moat" against the other four hundred fintech security firms that are frantically trying to find a way to get inside this obviously well-funded Big Gov project.

The Federal Reserve is self funded.

Re: FedNow Is Live

#683

Post by TulliusCicero »

HoyaSaxa wrote: post #298

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

> I'm happy to share anything that is not under NDA.

How will this eventually benefit consumers beyond what Zelle currently provides?

Re: FedNow Is Live

#684

Post by astrange »

jowea wrote: post #589
88913527 wrote: post #441

Earlier quoted context omitted.

Couldn't having payments settle so quickly result in increased risk of overall system instability? I don't have a specific example, but I'm thinking of things like bank run panics. I'm sure this sort of thing would have been considered, however.

Good question. Did that happen in any other country with faster payments? And SVB collapsed fast before this.

Part of the reason SVB collapsed is they couldn't get paid by government insurance fast enough IIRC.

Re: FedNow Is Live

#685

Post by TulliusCicero »

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…

> 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.

I thought FedNow was explicitly inspired by the success of India's UPI?

Re: FedNow Is Live

#686

Post by ericpauley »

grepfru_it wrote: post #570
cj wrote: post #555

Earlier quoted context omitted.

I can think of 0 occasions where I’ve given anyone my bank account info who isn’t a commercial organization (employer, electric company, etc). I had no idea it was the opposite in the UK. Edit: with the exception of writing physical checks, of course. I use those when the receiver doesn’t accept Venmo or Apple Pay.

I am currently disputing an international payment and wire transfer (or walking/driving my happy ass to their office and paying cash) is the only method allowed by the lawyer representing me. That's at least one occasion you are not accounting for (a foreign entity that needs the equivalent of cash to proceed)

To clarify: they only take wire transfers and not ACH debit/credit? This seems highly unusual.

Re: FedNow Is Live

#687

Post by eru »

aidenn0 wrote: post #436
HoyaSaxa wrote: post #298

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

Is the eventual end-game that I can send money from my account at Bank A, to a friend's account at Bank B to split a check at dinner without using a third party like Venmo?

Can't you already send money from bank A to bank B without Venmo? Isn't that the whole point of bank transfers?

Re: FedNow Is Live

#688

Post by astrange »

mattwilsonn888 wrote: post #659
634636346 wrote: post #439

Earlier quoted context omitted.

There are still almost 5k banks in the US. Unlike Zelle, if this opens to all of them, all you need is one bank.

One low quality bank? Bank gets bailed out? That's a dire sign for the fundamental value of the dollar to regular people if this is a regular practice. Bank gets bought up? Well we don't really have 5k banks anymore do we?

> Bank gets bailed out? That's a dire sign for the fundamental value of the dollar to regular people if this is a regular practice.

"Our insurance system works" is not a bad sign for your financial system.

Re: FedNow Is Live

#689

Post by eru »

This is really concerning. I wonder why they couldn't have looked into what (if anything) prevents the private sector from offering this service, and fixed those obstacles instead?

It seems to me like a government run shoe factory, or a government run mail service.

Re: FedNow Is Live

#690

Post by astrange »

landemva wrote: post #390
foobarian wrote: post #282

Earlier quoted context omitted.

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

It's like a centralized exchange in which funds can be seized, censored, and the participating brokers are licensed. Nothing like bitcoin.

It's also not like bitcoin because the exchange doesn't own dollars deposited at them and isn't run by a guy living in Dubai who's going to steal all of it.
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