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I wish so much that FedNow would put CashApp, PayPal, Venmo, etc. out of business. We don't need to gamify finance. Just make it fast, easy and safe to transf

I wish so much that FedNow would put CashApp, PayPal, Venmo, etc. out of business. We don't need to gamify finance. Just make it fast, easy and safe to transfer money between parties, please.

marcosdumay 2y ago
It seem to have launched an year ago. How is its adoption? Do people know about it? Is it easy to use it? I believe the US is the last of the largest economies to deploy something like FedNow. (The UK uses the EU one, doesn't it?) I imagine the credit card processors have put a huge fight.
Animats 2y ago
Yes. Many banks are putting in receive-only FedNow - money can come in that way, but not go out. The U.S. Treasury supports send-side FedNow, so they can send Social Security, Medicare, tax refunds, etc. to bank accounts enabled for it. So that takes care of many routine transactions. Send-side FedNow at the consumer level has problems. Credit card transactions are tied to something of value being transferred from the merchant to the buyer. That info is carried along with the money transaction. So claim-handling and error reversal work reasonably well. Like wire transfers, but unlike credit cards, PayPal, and ACH, FedNow is irrevocable. When you send money with FedWire, it's gone. Fraud control will be tough. There's no merchant transaction associated with the money transfer. There are plans to add that, so a company can send someone a bill and they can pay that bill with FedNow. But the ability to send your entire bank balance to anybody with a few clicks, with no recourse, worries banks.
- figassis 2y ago
  Seems like something banks can handle locally no? Adding necessary metadata and limits? At least until it’s updated systemwide?
  - Animats 2y ago
    That's the plan. Here's the general spec for bill pay.[1] [1] https://explore.fednow.org/resources/rfp-market-practices.pdf https://explore.fednow.org/resources/rfp-market-practices.pd...

I wish so much that FedNow would put CashApp, PayPal, Venmo, etc. out of business. We don't need to gamify finance. Just make it fast, easy and safe to transfer money between parties, please.

marcosdumay 2y ago

It seem to have launched an year ago. How is its adoption? Do people know about it? Is it easy to use it? I believe the US is the last of the largest economies to deploy something like FedNow. (The UK uses the EU one, doesn't it?) I imagine the credit card processors have put a huge fight.

Animats 2y ago

Yes. Many banks are putting in receive-only FedNow - money can come in that way, but not go out. The U.S. Treasury supports send-side FedNow, so they can send Social Security, Medicare, tax refunds, etc. to bank accounts enabled for it. So that takes care of many routine transactions. Send-side FedNow at the consumer level has problems. Credit card transactions are tied to something of value being transferred from the merchant to the buyer. That info is carried along with the money transaction. So claim-handling and error reversal work reasonably well. Like wire transfers, but unlike credit cards, PayPal, and ACH, FedNow is irrevocable. When you send money with FedWire, it's gone. Fraud control will be tough. There's no merchant transaction associated with the money transfer. There are plans to add that, so a company can send someone a bill and they can pay that bill with FedNow. But the ability to send your entire bank balance to anybody with a few clicks, with no recourse, worries banks.

figassis 2y ago
Seems like something banks can handle locally no? Adding necessary metadata and limits? At least until it’s updated systemwide?
- Animats 2y ago
  That's the plan. Here's the general spec for bill pay.[1] [1] https://explore.fednow.org/resources/rfp-market-practices.pdf https://explore.fednow.org/resources/rfp-market-practices.pd...