Did you know that, according to 2022 Federal Reserve studies, 74% of consumers and 83% of businesses sent or received a faster payment in the past 12 months?

Offering instant payments via the FedNow^SM Service will help your credit union meet this demand and keep pace with the competition. Plus, instant payments provide revenue growth and cost-saving opportunities that can benefit your credit union’s bottom line and increase member satisfaction.

Business and member benefits

• New revenue streams. Instant payments can open new market segments and revenue opportunities for your institution. For example, offering request for payment (RFP) capabilities via the FedNow Service can provide business members the ability to instantly send e-invoices to clients, streamline billing, and more.
• Loans.The always-on nature of instant payments makes it possible for your financial institution to disburse funds instantly on weeknights and weekends, which can lead to additional loan revenue opportunities.
• Better member experience.Your financial institution can increase member satisfaction by meeting their expectations and providing instant payment services that give them greater convenience, control, and visibility into the payment process. For example, with RFP bill pay, retail members get the convenience of an end-to-end payment process — from invoice notification to payment delivery — all on their mobile phone or tablet.
• Value-added benefits for businesses you serve.Instant payments can help your business members better manage their cash positions, reduce administrative burden and costs, and improve efficiency.
• Cross-selling products.When your members experience the efficiency, ease, and transparency your instant payment platforms provide, they may be more willing to explore other services and products your organization offers.

Cost savings

Instant payments can also provide cost-saving opportunities to your credit union. For example, your financial institution likely still receives paper checks from some members for loan repayments. These payments may impact your financial institution’s bottom line, since paper payment services are typically less profitable. As instant payments gain popularity, so will straight-through processing rates, which can contribute to higher profitability margins for your financial institution.

Additionally, with traditional payment channels, your members may not know when a payment is completed or when funds are available. These questions, among others, can generate member calls and inquiries. Responding to these calls requires resources on your end, and this payment uncertainty can contribute to lower member satisfaction.

Instant payments may not eliminate inquiries entirely, but calls may be significantly reduced due to attributes such as immediate settlement, transparency, and information-rich formats capable of carrying large amounts of structured remittance data. This may translate to a better experience for your members and cost savings to your organization.

Take action

Learn more about instant payments and how to prepare for the FedNow Service at FedNowExplorer.org, or contact your Federal Reserve relationship manager.

 “FedNow” is a service mark of the Federal Reserve Banks. © 2023 Federal Reserve Banks