Proposed FedNow change would improve cross-border payments

A Federal Reserve proposal would permit FedNow participants, including credit unions, to use an intermediary for the purpose of facilitating cross-border payments. FedNow is the Federal Reserve’s instant payments infrastructure. In comments filed Tuesday, America’s Credit Unions supported the proposed amendments.

“Amendments to Regulation J which aim to facilitate closer integration of FedNow with cross-border payment flows will help credit unions improve the payments experience of their members—particularly business entities that may need to make time critical payments to foreign suppliers,” the comment letter reads.

Under current regulations, a FedNow participant may not send a payment order to a Reserve Bank that requires a payment order to be issued to an intermediary bank other than another Reserve Bank.

In addition to supporting the proposed changes, America’s Credit Unions recommends the Federal Reserve coordinate with the CFPB to determine whether new exceptions are warranted for third-party fee disclosures and estimates.

Read the full letter