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What do CUs want in Fed's real-time payments service?
NAFCU Tuesday sent a Regulatory Alert to member credit unions seeking feedback on the Federal Reserve's FedNow Service – a real-time gross settlement service that will feature integrated clearing functionality designed to process individual payments within seconds.
In the Regulatory Alert, NAFCU notes that although credit unions will have the ability to settle faster payments through the FedNow Service, "interoperability with existing, private sector systems is not guaranteed."
NAFCU would like credit unions to specifically consider:
- their support of the Federal Reserve's decision to develop the FedNow Service;
- features that are essential to incentivize use of the service; and
- desirable tools or support to minimize the risk of payments fraud in connection with irrevocable, real-time transactions through the FedNow Service.
Credit unions can submit comments to NAFCU until Oct. 18; comments are due to the Fed Nov. 7.
NAFCU continues to lead on this issue, having served on both the Fed's Faster Payments and Secure Payments Task Forces, and holding member meetings with St. Louis Federal Reserve Bank President James Bullard, Boston Federal Reserve Bank President Eric Rosengren and Minneapolis Federal Reserve Bank President Neel Kashkari in recent months.
The association has long pressed the Fed to play an operational role in efforts to modernize the nation's payment system and NAFCU President and CEO Dan Berger met with Federal Reserve Governor Lael Brainard to encourage the Fed to play an operational role in a future, faster payments system.
The association and its Board of Directors are set to meet with Fed Board Governor Michelle Bowman and senior Fed staff this fall to present findings from NAFCU's Annual Report on Credit Unions and to discuss issues critical to the industry.