FedNow Sees Explosive Growth in Instant Payments

The Federal Reserve's instant payment service, FedNow, has been growing rapidly since its launch three years ago. In that time, it has connected over 1,900 financial institutions and processed daily transfers worth close to $4 billion.

In a recent fireside chat at the Philadelphia Fed's Fintech Conference, Federal Reserve Chief Payments Executive Mark Gould discussed the evolution of payments and the role of the Fed in keeping them safe and efficient. Gould noted that faster payments can be particularly helpful during times of crisis, such as disasters, when local bank branches or ATMs may be out of commission.

One example Gould cited was a story about an insurance check being used as a doormat after a flood. He imagined a scenario where the adjuster could send the funds instantly, rather than waiting for the physical check to arrive.