FinTech Automation to provide payments technology on FedNow Service platform
FinTech Automation (“FTA”) announced today that it has signed an agreement with the Federal Reserve Bank of Boston to be a provider of enabling financial technology for instant payment services on the FedNowSM Service, which will launch in phases starting in July 2023.
The FedNow Service is a new instant payment infrastructure developed by the Federal Reserve that will allow financial institutions of every size to provide safe and efficient instant payment services. Through the service, funds will settle between participating financial institutions instantly, with no buildup of interbank obligations or short-term credit risk.
David Park, Founder and CEO of FinTech Automation said, “One of our main goals has been to help banks, credit unions, and ODFIs in launching new embedded finance solutions. The ability to facilitate secure instant payments through the FedNow System will be a real game changer for these financial institutions. Using our platform, clients will have the ability to deploy this enabling technology quickly without having to touch lines of code.”
The FedNow platform will offer core clearing and settlement capabilities with credit transfers completing in seconds making instant payments available 24x7x365. It also features access to balance information around the clock, along with activity reports available on demand or at end of day.
Additionally, financial institutions will be able to settle using their own master account or a correspondent’s master account and includes configurable features for each routing transit number (RTN) enabled, such as the ability to receive customer transfers, send and receive customer transfers, receive requests for payment, support financial institution liquidity management transfers, and support settlement services for other financial institutions.
Financial institutions using the FedNow Service will remain competitive, have the ability to create new financial products, and meet the growing needs of customers. In turn, this will allow financial institutions’ business customers to gain better control of cash flow management, improve efficiency of corporate payments, and streamline their reconciliation processes.
The first release of the FedNow Service will provide baseline functionality that will support a range of functionality, including those account-to-account (A2A) transfers and bill pay.
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