FedNow® Service two-year update: A Q&A with Chief FedNow Executive Nick Stanescu

Two years ago, the Federal Reserve launched the FedNow Service to serve the needs of U.S. financial institutions of all sizes and help pave the way for 24/7/365 instant payments for businesses and individuals nationwide.

Chief FedNow Executive Nick Stanescu shares his perspectives on how things are going and what's ahead for the network.

July 2025 is the two-year milestone for the FedNow Service. Can you give us a status update?

The pace of adoption of the FedNow Service has been incredible. We currently have more than 1,400 participants, up from 900 at our one-year anniversary, and the network keeps growing every day. Along with adoption, volume continues to rise, and the number of senders is steadily climbing.

Even more exciting is the explosion of instant payment innovation emerging among financial institutions, payment processors, and fintechs. Use cases like instant payroll, auto loan disbursements, and digital wallet defunding have started gaining a lot of traction. We're also seeing novel use cases crop up each day across a number of industries—real estate transactions, brokerage account defunding, insurance payouts, and more.

All that energy reflects the growing demand for instant payments in the U.S. It's something businesses and consumers now expect from their financial institutions.

What other developments are on the horizon for the FedNow Service?

Based on conversations I've had at recent industry conferences and customer meetings, I'd say merchant refunds, account funding, health care and small business payments are use cases likely to emerge strongly in the next 12-18 months. But I fully look forward to seeing unexpected use cases because they very often bubble up in unpredictable ways.

The FedNow Service is use-case agnostic by design to encourage innovation across industries and the broader payments ecosystem.

We're also seeing momentum building in the industry around request for payment (RFP), which is a feature the FedNow Service has had since launch. RFP is a way for a person or business to request an instant payment from another person or business. Increasingly, we're going to see financial institutions start offering instant bill pay services that can help their customers conveniently send e-invoices, receive instant bill payments, and better manage cash flow.

What are customers telling you about the service? What about opportunities for improvement?

We launched the service in response to what the industry was asking us to do. Today is no different. We're constantly talking to our customers—the 9,000 banks and credit unions across the U.S.—in one-on-one meetings, at industry events, and via forums like the FedNow User Group.

One thing that stands out for our participants is that they really appreciate the hands-on customer support from their relationship managers and the FedNow onboarding teams before, during, and after they adopt the service. The onboarding experience is fully digital and streamlined.

They also appreciate the simplicity of managing liquidity on the FedNow Service. It's the same way they settle with other Federal Reserve financial services. It's what they know— no new processes or overhead to manage.

Of course, there is always room to make the FedNow platform even more valuable. Recently, participants gained access to new account activity threshold functionality, which adds an additional layer of protection against fraud. Participants can customize value and velocity thresholds by customer segment to fit their unique business needs and risk tolerance. These new risk mitigation features kicked in alongside an individual transaction increase to $1 million.

Speaking of risk mitigation, fraud is a major concern with any payment rail. What about on the FedNow network?

Fraud is something everyone needs to be on guard against, no matter what payment rail is being used. There is often a misconception that newer payment rails are less secure, which can lead consumers and businesses to use payment methods that may expose them to risk. For example, 91 percent of businesses are currently using paper checks, which is the payment type most affected by fraud, according to the 2025 Association for Financial Professionals Payments Fraud and Control Survey Report.

In contrast, our customers tell us they have seen very little evidence of fraud on the FedNow network to date. That said, the risk of fraud is always evolving and is something the Federal Reserve takes very seriously across all payment rails, including the FedNow Service. Looking ahead, we recently launched a pilot to develop additional network fraud risk mitigation capabilities to support participants' fraud risk management.

We are dedicated to providing our FedNow Service customers with features and functionality that give them lots of control over their risk exposure and liquidity. For example, in addition to the account activity threshold functionality, we've recently added correspondent net send limits which enable correspondents—financial institutions that settle funds on behalf of FedNow Service-participating financial institutions—to set net send limits (or limits on the total dollar amount of payments, less any funds received) for their direct respondents at the respondent financial institution level.

Any final words?

A lot of times, I get asked, "What is the goal for the FedNow Service?" The short answer is instant payments ubiquity, which will bring widespread benefits to financial institutions and their customers.

A recent survey indicated that 66% of businesses were likely to use instant payments if their primary financial institution offered it, and businesses using instant payments reported 10 percent greater satisfaction with their primary bank or credit union. Statistics like that tell me we are well on our way to instant payments ubiquity in the U.S.

To the financial institutions already participating in the FedNow network, congratulations on getting ahead of the curve—and thank you! For others, I'd encourage you to talk to your relationship manager and view our online resources about the potential impact for your organizations and those you serve. Participating in the FedNow Service can deliver wide-ranging benefits to your customers and members and important opportunities to your institutions. Now is the time to get on board.

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