The US Federal Reserve is planning to roll out a 24/7 real-time payments and settlement service to enable faster payments.

Called FedNow, the service is slated to be made available in 2023 or 2024.

The confirmation of the move comes after public comment on the development of a new service for faster payments by the Federal Reserve.

The central bank received over 350 comments in the matter, out of which over 90% were in favour of the move.

The central bank is now seeking comment on the system’s design.

At the same time, the Federal Reserve plans to expand the Fedwire Funds Service and National Settlement Service to operate round the clock.

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Federal Reserve board governor Lael Brainard said: “Everyone deserves the same ability to make and receive payments immediately and securely, and every bank deserves the same opportunity to offer that service to its community.

“FedNow will permit banks of every size in every community across the country to provide real-time payments to their customers.”

The move was welcomed by American Bankers Association (ABA), a trade body for the US banking sector.

ABA president and CEO Rob Nichols noted: “ABA has been a strong advocate for real-time payments in the U.S., and we believe every bank in the country and their customers will benefit from a seamless and ubiquitous system.

“We hope today’s decision by the Federal Reserve to create its own real-time payments network will speed that transition.”

FedNow would compete with The Clearing House (TCH), a private real-time payments service controlled by large banks.

TCH stated: “While we will stay abreast of the Fed’s efforts to develop its own real-time payments system which may become available in 2023 or 2024, our focus will remain on ensuring that the RTP network has reach to all depository institutions.”