The US Federal Reserve has confirmed that its real-time payments offering, dubbed FedNow, will be rolled out in the middle of 2023.
The FedNow Pilot Program, with is joined by nearly 120 entities, will commence technical testing of the payments service from September 2022.
In this phase, participants will test operational and messaging features of the service.
Production rollout of the service is expected between May and July next year.
The Fed will also rope in non-pilot financial institutions and service providers to evaluate the adoption of the service.
FedNow, which will be accessible to financial institutions of all sizes in the US, is aimed at enabling businesses and consumers to securely transfer and receive instant payments.
Access to the service will be provided through Fed’s FedLine network, which currently caters to the needs of over 10,000 financial institutions.
Federal Reserve vice chair Lael Brainard said: “Just as the Federal Reserve has made a substantial commitment to our new instant payment infrastructure, we are calling on industry stakeholders to do the same.
“The shift to real-time payment infrastructure requires a focused effort, but the shift is inevitable.
“The time is now for all key stakeholders—financial institutions, core service providers, software companies, and application developers—to devote the resources necessary to support instant payments.”
“This means upgrading back-office processes, evaluating accounting procedures to accommodate a seven-business-day week, arranging liquidity providers, deploying a new customer-facing application, and promoting instant payments for key use cases to customers,” Brainard added.
To facilitate FedNow’s launch, the Fed recently delayed the rollout of ISO 20022 payment messaging format to 2025.
In June 2021, fintech solutions provider Computer Services (CSI) joined the pilot programme for the development of FedNow.