Have you ever felt like you're stuck on a hamster wheel, waiting forever for your money to move? Yeah, me too. It's frustrating, right? Well, guess what? The financial sorcerers have finally heard our prayers and cooked up a shiny new solution called Fednow Service.
Okay, okay, I know what you're thinking. Another boring banking service that doesn't really affect me. Wrong! This service is a game-changer for everyone who uses money (which is pretty much everyone).
This new platform will make your money-moving experience a breeze, giving you the freedom to get off that wheel and let your cash flow like a river.
But how does this magic work, you ask?
We're about to explore a bit of Fednow, where transactions move faster than you can blink. Say bye to those annoying waiting times and hello to instant payments.
How Fednow Works
This instant payment system is like a super-fast highway for your money, sending it from one account to another in a flash.
No more watching that spinning wheel of doom while your cash is stuck in no man's land. With FedNow, your dough is always on the go, 24/7/365.
Imagine this: You're out with friends, having a great time, and the bill comes. Yuck, right? But don't worry, my tech-savvy friends!
With FedNow, you can split that bill faster than ninja chops through human flesh.
Just take out your phone, tap a few buttons, and – bam! – your part of the bill zooms through the internet straight into your friend's bank account.
No more IOUs or awkward 'Hey, remember when I paid for that thing?' chats. Thanks to the speed of FedNow, you can enjoy instant payments and transactions.
When Will Fednow Be Available?
In just a few months, you'll be able to use this modern instant payment solution that'll transform your financial transactions. FedNow is expected to launch in 2023 and will be available to all banks and credit unions in the US.
That means you'll be able to send and receive money instantly with anyone who has a bank account in the country. No more delays or fees for transferring money across different platforms or networks.
FedNow will make your life easier and more convenient by giving you more control over your money. You'll be able to pay bills, send gifts, donate to causes, and more with just a few clicks.
So get ready for FedNow, the future of instant payments. It's fast, it's easy, it's awesome. And it's coming wether you like it or not, soon to a bank near you.
Does Fednow Run On Blockchain Technology?
Does it use blockchain technology like Bitcoin or Ethereum? Does it create a digital dollar like China or Sweden?
The answer is no. FedNow does not use blockchain technology or create a central bank digital currency (CBDC).
It's a centralized service that relies on third parties and banks to operate.
FedNow uses the ISO 20022 standard, which is a common language for financial messages. This standard allows FedNow to communicate with different payment systems and financial institutions easily and securely.
FedNow is not trying to compete with blockchain or CBDCs.
It is trying to provide a fast and convenient payment solution for everyone who uses money (which is pretty much everyone).
However, this isn't to say that at some point down the dirty future, that blockchain technology won't be integrated with this service.
There are cryptos like XRP, Algorand, IOTA, and others that run on the ISO 20022 standard.
These blockchains are highly secure, and offer benefits through their technologies that could play host to Fednow or some related service down the line.
ISO 20022: The Common Language For Digital Payments
ISO 20022, is the standard that FedNow uses to communicate with different payment systems and financial institutions. But do you know what it is and how it works?
It's a standard that defines a common language for financial messages. It is like a dictionary that tells you how to write and read messages about payments, securities, and other financial transactions.
ISO 20022 is a global and open standard, which means anyone can use it and contribute to it. It is developed by ISO Technical Committee TC68 Financial Services, which includes experts from banks, regulators, payment service providers, and other stakeholders.
It's not just a set of rules or formats, it's a platform that allows you to create and customize messages according to your needs. It also has a repository that stores all the message definitions and business processes.
There will be many benefits for the payments industry. It will achieve richer, better structured, and more granular data to be carried in payments messages.
This means more transparency and more remittance information for your customers, which in turn means better customer service and experience.
ISO 20022 also improves operational efficiency, compliance processes, fraud prevention measures, and analytics. It supports end-to-end automation and straight-through processing. And it uses modern XML technology, which is easy to integrate and well-supported.
This has been around since 2004 and has been adopted by almost 200 market infrastructure-driven initiatives around the world. It covers all business domains and end-to-end business processes for payments and securities.
Expect to hear more about it, in regards to the financial sector in the coming months and years.