Increased adoption of The Clearing House’s faster payments system could put pressure on community banks and credit unions awaiting the launch of the Fed’s competing service, FedNow.
The promise of real-time payments and the reality of the market are often at odds. That’s not a bad thing — it’s a sign there are pockets of demand that weren’t originally foreseen.
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Community banks and tech companies that are happy the central bank is building a next-generation system are not as pleased with its four- to five-year timeline. But big banks see the slow rollout as an opportunity to expand their own instant payment network.
Kenneth Montgomery, a top executive at the Federal Reserve Bank of Boston, will head the push to make faster payments available across the industry in the next four to five years.
Anticipating recession, banks start scrubbing loan books; how Trump's political appointees thwarted tougher settlements with two big banks; the Fed's plans on its real-time payment service; and more from this week's most-read stories.
