Akhil Rao’s Post

On the cusp of Nacha's annual Smarter Faster Payments conference, the Federal Reserve Board has issued a proposal to “expand the operating hours of the Fedwire Funds Service to 22 hours per day, 7 days per week, every day of the year (22x7x365) and to correspondingly expand the operating hours of NSS, with NSS closing 30 minutes earlier than the Fedwire Funds Service.” Among other things, this proposal (if adopted) would enable private-sector settlement of ACH payments on weekends and holidays. Settlement of ACH payments on weekends and holidays could provide funds availability faster than the next banking day. Nacha and its membership have supported and advocated for such a change since the start of the Fed’s Payment System Improvement initiative. https://lnkd.in/e-BA3Ufq

Fed invites comment on expanding payment services to weekends and holidays The Federal Reserve Board is requesting comment on its proposal to expand the Fed's two payment services—Fedwire Funds Service and the National Settlement Service—to run 365 days per year. Comments on the proposal are due 60 days after publication in the Federal Register. Under the proposal, the Fedwire Funds Service, which is used for electronic funds transfers up to $10 billion, and the National Settlement Services, which lets banks and other participants in private clearinghouses settle transactions by crediting and debiting their respective Federal Reserve accounts, would be open year round, though they'd still close daily between 7 and 9 PM Eastern Time. The changes wouldn't come immediately: Banks are already in the process of handling technical changes in the Fedwire Funds Service's messaging format, slated to be implemented for March 2025. The Fed estimates the change in hours wouldn't come until at least 2027. #paymentservices #FederalReserve #accounts

ACH, SWIFT, and Fedwire are essential methods for money transfers between financial institutions. Here's a breakdown of their key differences: 🔹ACH Payments: - Speed: 1-3 business days, same-day options available. - Cost: Low-cost or free, ideal for routine transactions. - Use case: Primarily for domestic U.S. payments. - Processing: Batch system with grouped payments. - Security: Secure for lower-risk transfers. 🔹SWIFT Payments: - Speed: 1-5 business days, varies by countries. - Cost: More expensive with international fees. - Use case: Global network for secure international transfers. - Processing: Messages exchanged between banks. - Security: Highly secure with strong encryption. 🔹Fedwire Payments: - Speed: Real-time transfers, immediate fund movement. - Cost: More expensive, fees per transaction. - Use case: High-value, time-sensitive U.S. transfers. - Processing: Real-time settlement system. - Security: Highly secure for high-priority transfers. Key Differences: - Speed: Fedwire > SWIFT > ACH. - Cost: ACH < Fedwire < SWIFT. - Use: ACH for domestic, SWIFT for international, Fedwire for high-value domestic transactions. #Finance #FCYaccount #Banking #Payments #ACH #SWIFT #Fedwire #Crossbordertransactions

🏦 Custodian Banks: Safeguarding Your Assets In the complex world of finance, custodian banks play a crucial role. But what exactly are they? 🔒 Safekeeping Services: Imagine a secure vault where your valuable assets—stocks, bonds, and more—are stored. Custodian banks are like those vaults. They hold your securities, ensuring they remain safe from theft or loss. 📊 Beyond Safekeeping: Custodian banks offer more than just storage. They handle account administration, settle transactions, provide tax support, and manage foreign exchange. Think of them as the ultimate financial gatekeepers. 🌐 Distinct from Retail Banks: Unlike regular banks, custodian banks don't lend money or offer retail services. Their sole focus is safeguarding your assets. Next time you hear about custodian banks, remember—they're the silent protectors of your financial world! 🛡️💼 #FantasticFriday #industryreadiness #readyforbeyondcovid19world  #trusttheprocess #CampusToCorporate #YouVersion2Point0 #100daysTransformationChallenge

The US's journey with Real-Time Payments (RTP) is a fascinating blend of technological innovation and strategic caution. The diversity and scale of the US banking system naturally slow down the adoption rate compared to other countries. The launch of FedNow in 2023 initially created uncertainty among financial institutions, but interestingly, it has boosted the adoption of TCH-RTP. The overlapping memberships in both networks suggest a prudent, exploratory approach by banks. Although competition between FedNow and TCH-RTP raises concerns about fair play, especially with FedNow's extended fee waivers, it's a positive step for consumers and businesses, promising lower fees and more innovative services. The evolving RTP landscape in the US is a crucial space to watch, as it will significantly impact the future of financial transactions.

Exciting news for the banking world! More and more financial institutions are hopping on board with FedNow, the Federal Reserve's instant payments network. Learn how this shift is reshaping banking operations and opening new possibilities for faster, more secure transactions. Read the full story here: https://bit.ly/4bnPHhu #FedNow #BankingRevolution 🏦💸

In simpler terms, a serial payment refers to a series of payments that are made one after the other, often in a direct sequence. When a serial payment occurs, both the money being transferred (via wire transfer) and the accompanying payment message move together from the bank sending the money to the bank receiving the money. This movement can happen directly between the two banks involved or may involve one or more intermediary banks (such as correspondent banks) along the way. So, essentially, it's a step-by-step process where funds and information move from one financial institution to another until they reach their final destination. . . #WealthWisdom #SerialPayment #IIBF

interesting summary with comments on the latest guidance for 3rd party partnerships and impacts to #banking_as_a_service programs...worth the read if you are a service provider in the space or a bank wishing to use a service provider for these functions. https://lnkd.in/ev68VJa9

There are many reasons to choose an alternative provider instead of – or in addition to – a traditional bank. 🪙 Maybe you're at risk of being debanked, or perhaps you need a bespoke account or one-on-one relationship management. In this article, we look at which alternative banking features really matter, and why, from multi-currency support to onboarding speed. 💡 #multicurrency #alternativebanking #debanking #InterpolitanMoney https://lnkd.in/eB2g-r8X

Exciting news for the banking world! More and more financial institutions are hopping on board with FedNow, the Federal Reserve's instant payments network. Learn how this shift is reshaping banking operations and opening new possibilities for faster, more secure transactions. Read the full story here: https://bit.ly/4bnPHhu #FedNow #BankingRevolution 🏦💸