The Federal Reserve is proposing a significant expansion of its real-time payments system, a move that could reshape how money flows between banks and credit unions, Bloomberg writes.
Under the plan, financial institutions would be allowed to use intermediaries when transferring funds through the FedNow platform, loosening current restrictions that limit transactions to just two participating banks.
The change would open the door for more private sector firms to participate in FedNow, potentially improving access, efficiency and speed, particularly for complex or cross-border payments. Regulators say the proposal is aimed at giving lenders more flexibility in how they transact while reducing friction across the broader payments ecosystem.
Launched in 2023, FedNow was designed to enable instant payments across the U.S., but its structure has limited use cases. If approved, the new framework could accelerate adoption and make real-time payments more versatile, signaling the Fed’s continued push to modernize financial infrastructure.
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