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0 pointsrowls662y ago0 comments

There are already other options for instant payments in the US. The Zelle network and The Clearings House's RTP have been running for several years, and provide pretty good account reachability today. FedNow is the result of smaller banks and credit unions wanting an alternative to Zelle and RTP which are both owned by consortiums of the big banks. The expectation in the industry is that there will eventually be interoperability between these systems, and it will not make much difference to consumers which one their bank uses. Similar to how paper check and ACH clearing works in the US today.

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riskable2y ago

Zelle isn't a good comparison because it's not made for things like paying employees or other businesses. It was made specifically for payments between individuals and in fact, the big banks that run Zelle could very well change the terms to specifically forbid using it for things like payroll (actually, they might already forbid it but I'm not sure).

FedNow is good for basically everything: Payments between individuals, employeers/employees, B2B, etc. More importantly, the fees are so low it might as well be considered free ($0.045/transfer) which is HUGE.

msla2y ago

> The expectation in the industry is that there will eventually be interoperability between these systems

Why? Why would the companies presumably making good money with Zelle interoperate with something that's stealing their customers? It seems like there's no advantage for the entity running Zelle to allow interoperability, and there might even be ToS language preventing any bank or credit union currently in Zelle from so much as moving towards FedNow.

rowls66OP2y ago

The Clearing House and the Fed both operate ACH networks, and they inter operate. I expect that we will get a similar outcome in instant payments.

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