What is FedNow?
FedNow is the Federal Reserve’s real-time payment system. It allows banks and credit unions of all sizes to send and receive money instantly, 24/7/365. Unlike traditional payment methods that can take hours, or even days, FedNow transactions settle within seconds.
Why FedNow, now?
The idea of faster payments is not a new or particularly profound concept. Globally, many countries already had real-time payment networks ahead of the U.S., while the U.S. largely relied on ACH (Automated Clearing House) and wire transfers. While ACH works well for payroll and bill pay, its drawbacks are speed and flexibility. On the other hand, wires are faster than ACH but can get very expensive and they are difficult to scale. As a whole, financial institutions were not satisfied with the system and it’s been an ongoing journey to improve payment distribution.
In 2017, The Clearing House launched RTP (Real-Time Payments) in the U.S. While this system is great for larger banks, it’s not an all inclusive solution. Adoption of RTP is limited across the U.S. and smaller institutions wanted a more accessible option.
That’s why in 2019, the Federal Reserve announced it would build FedNow—a public, nationwide system for instant payments. After years of development, FedNow officially launched in July 2023. FedNow represents one of the biggest shifts in U.S. payments in decades. By making instant payments universally available, it brings the U.S. in line with global peers.
The future of FedNow
Since 2023, more than 1300 financial institutions have implemented FedNow and the payment system is growing. In Q2 of 2025, over 2 million payments were settled, totalling more than 245 billion dollars. With the excitement around this growing payment system, more organizations are looking to adopt the system. Over time, FedNow could become as popular as ACH, meaning nearly every U.S. payment (payroll, bills, B2B, government, personal) could move instantly.
Recently, Routable joined the growing number of organizations who are redefining how payments get sent across the country. With FedNow augmenting Routable’s existing Real-Time Payments (RTP) offering, Routable customers now have the ability to send instant payments to up to 85% of US bank accounts.
“With the rise in demand for instant payments, businesses are seeking greater flexibility. FedNow substantially increases our coverage for instant payments so we can better support our customers.”
Ready to learn more about how Routable can help you manage and distribute payments with ease? Let’s talk.
