Next time you pay back your pals for a drive-in concert ticket, don’t be alarmed if they ask you to “FedNow me.”
Forget Venmo. The Fed is launching the next big thing in fintech — a 24/7 payments platform called “FedNow Service.” It charges no transaction fees, and you don’t even need an app to use it.
Call it a fintech public option
Right now, Venmo and Zelle run on a platform called The Clearing House. Basically, it’s a group of major banks that have agreed to allow instant deposits.
The problem? A lot of regional banks and credit unions don’t use The Clearing House. Only about 50%+ of the US has access.
FedNow wants ALL the banks at the party
And it’s got relationships with 10k+ financial institutions, so pretty much all of them could go.
It sounds good, but it’s going to be a while before your friends make fun of you for forgetting your FedNow username. The service isn’t hitting the market until at least 2023.