“Crucial milestone for payments transformation,” says ICBA’s Romero Rainey
Washington, D.C. (July 20, 2023)—The Independent Community Bankers of America (ICBA) today commended the Federal Reserve for its launch of the FedNow Service, the Fed’s instant payment service that ICBA has staunchly advocated for years.
“ICBA has been a constant advocate for the development of the FedNow Service, and today’s announcement by the Federal Reserve marks a crucial milestone for payments transformation,” ICBA President and CEO Rebeca Romero Rainey said. “With the market for faster payments growing rapidly, FedNow marks a significant opportunity for community banks to adopt faster payments products and services as they continue to evolve their strategies and solutions to best serve their customers — all while offering the personalized approach to banking for which they are known.”
The FedNow launch is an important development for community banks, with the service allowing these local institutions to gain access to a new payment system with instant clearing and settlement and requests for payment. These new features will offer community banks and their customers safe, secure, and efficient real-time payments for a variety of use cases. FedNow also negates the need for a U.S. central bank digital currency by achieving the same policy goals without the risks a CBDC poses to the banking system.
ICBA encourages community banks to enroll in FedNow, including as “receive-only” participants, which can receive instant payments without being required to have the ability to originate payments through the service.
More information on FedNow is available via a recent Independent Banker magazine article on how it differs from other instant payments tools, a separate Independent Banker guide for community banks, and ICBA Bancard’s instant payments resource center.
The Independent Community Bankers of America® creates and promotes an environment where community banks flourish. ICBA is dedicated exclusively to representing the interests of the community banking industry and its membership through effective advocacy, best-in-class education, and high-quality products and services.
With nearly 50,000 locations nationwide, community banks constitute roughly 99 percent of all banks, employ nearly 700,000 Americans and are the only physical banking presence in one in three U.S. counties. Holding nearly $5.9 trillion in assets, over $4.9 trillion in deposits, and more than $3.5 trillion in loans to consumers, small businesses and the agricultural community, community banks channel local deposits into the Main Streets and neighborhoods they serve, spurring job creation, fostering innovation and fueling their customers’ dreams in communities throughout America. For more information, visit ICBA’s website at www.icba.org.