CUNA backs FedNow proposal, urges CU involvement in process

CUNA strongly supports the Federal Reserve board’s decision to develop interbank settlement of faster payments, it wrote Thursday. The Fed proposed potential actions to create an interbank 24x7x365 real-time gross settlement service with integrated clearing functionality called FedNow.

“Credit unions have long encouraged the board to extend the Federal Reserve system’s role as the foremost payments system operator into the nascent U.S. faster or real-time payments market,” the letter reads. “The board’s decision, as detailed in the notice and request for comment, is welcomed by credit unions and is an important step forward in the development of a ubiquitous real-time payments system.”

CUNA has also supported The Clearing House (TCH) efforts to develop its real-time payments network, and its letter notes that while credit unions have worked well with the TCH, “absent the [Federal Reserve] board or another entity operating a real-time payments network, the more than 10,000 credit unions and community banks that are not owners of TCH would be beholden to the whims of TCH’s bank owners for a critical aspect of their infrastructure.”


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