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FedNow Is Live

federalreserve.gov

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Re: FedNow Is Live

#741

Post by cubefox »

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.

FedNow can replace credit cards for cases where chargeback or actual credit isn't necessary. So for many ordinary cashless payments.

Arguably even for many cases (small to medium amounts of money) where the possibility of chargeback seems useful FedNow could be better in expectation, because the fees are lower. The credit card companies are making money after all. Using them for chargeback is like buying insurance for things you can replace out of pocket: On average, you make a loss.

Re: FedNow Is Live

#742

Post by treyd »

AmericanChopper wrote: post #405
treyd wrote: post #347

Earlier quoted context omitted.

The FedNow project was in the works long before any serious CBDC idea was conceptualized.

I work with a couple of organisations that have been advising public institutions on their investigations into CBDCs, and the entire timeline of FedNow development took place after CBDCs had initially been conceptualised. CBDCs became a mainstream concept in 2016 when the Bank of England started discussing them publicly. The Faster Payments Taskforce report (which was the basis of FedNow’s design) came out in 2017, a…

>But FedNow has been designed in such a way that it could easily be modified to support one.

Curious how this would work, it would be a pretty big inversion of asset control to make it work.

Saying "just have to" is a very big "just", considering it was aimed at only a few thousand institutions with very tight reporting requirements being the target audience instead of hundreds of millions of nontechnical users that would need something that just werks.

Re: FedNow Is Live

#743

Post by inquirerGeneral »

silisili wrote: post #609
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

Will this replace ACH and/or Plaid for sending money amongst my own various accounts, as well, or is it intended more as a 'payment' than a tranfer?

Plaid still uses ACH just like it has always been used for years.

It is just an easier way to connect and link accounts and data alongside it.

Re: FedNow Is Live

#744

Post by cubefox »

aussieguy1234 wrote: post #739

We've had something similar (OSKO/PayID) in Australia for a couple of years now. In our case it wasn't the government, but the private banks getting together to launch it themselves. Unfortunately its a big target for scammers. Once the cash is instantly transferred, there is little to no chance of getting it back. There are no chargebacks like with credit cards and the instant nature of it means payments can't be re…

... except for buying things from countless trusted online companies? Reminds me of

https://astralcodexten.substack.com/p/the-buying-things-from...

Re: FedNow Is Live

#745

Post by cjalmeida »

TechBro8615 wrote: post #653
gtirloni wrote: post #581

Earlier quoted context omitted.

And it seriously rocks. It has been such a tremendous change to everyday life.

What happens when it becomes so good that it's the only option? There's no need for it to be profitable, so it can inevitably undercut private sector competitors. Do you want to live in a country where the central bank controls and monitors your ability to transact with other people? Just last year, the Canadian government weaponized "debanking" in an effort to quell peaceful protests against vaccination mandates. Th…

We're not a banana republic and actually have laws governing what the central back can do, and they can't block transfers without a warrant. Any private banking solution would be subject to same kind of laws.

Re: FedNow Is Live

#746

Post by baby »

mighmi wrote: post #698
monkeywork wrote: post #679

Earlier quoted context omitted.

It sounds very much like some of the Interac services that we have here in Canada (and have had for ages). We can do what is called "email money transfer" where as long as I know your email address I can go into my bank app, transfer money to you and it will automatically show up in your bank account.

The US already has Zelle which does this. However the roll out was botched, many banks don't seem to use it and most people (including me until a few months ago) thought it was a paypal competitor - but it's actually a government based system system which renders free transfers between bank accounts (your own or others) with a cap of 3 or 5k/month. The interface is very weird. Many people can't figure out how to use…

You’re heavily limited in terms of transfers also. I need to split my rent over several payments over several days using zelle. It really sucks compared to something like SEPA

Re: FedNow Is Live

#747

Post by [deleted] »

ccleve wrote: post #319
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

Tell us as much as you can about the tech stack. What is going to be able to handle truly massive volumes of transactions? Database, hardware, communications channels, programming lang, everything.

[deleted]

Re: FedNow Is Live

#748

Post by [deleted] »

baby wrote: post #746
mighmi wrote: post #698

Earlier quoted context omitted.

The US already has Zelle which does this. However the roll out was botched, many banks don't seem to use it and most people (including me until a few months ago) thought it was a paypal competitor - but it's actually a government based system system which renders free transfers between bank accounts (your own or others) with a cap of 3 or 5k/month. The interface is very weird. Many people can't figure out how to use…

You’re heavily limited in terms of transfers also. I need to split my rent over several payments over several days using zelle. It really sucks compared to something like SEPA

[deleted]

Re: FedNow Is Live

#750

Post by mattclarkdotnet »

cyberax wrote: post #721
landemva wrote: post #561

Earlier quoted context omitted.

The Fed is a contractor with pomp and circumstance to make it appear different. Any private group charter can require their club leader to be approved by the Pres. and the Pres. may or may not play along.

The Fed is the only entity in existence that can _create_ dollars out of thin air. US Treasury is responsible for the printed paper dollars, but only the Fed can create "digital" ones.

This is a huge but common misunderstanding.

Every time a bank makes a loan, the dollars are "created out of thin air", and slowly "destroyed" as the loan is repaid.

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