Explore Instant Payments With SHAZAM's FedNow Credit Receive Service

The Federal Reserve’s FedNow^SM Service is an additional instant payment infrastructure that will allow financial institutions (FIs) of every size across the U.S. to provide efficient instant payments to their accountholders.

SHAZAM has been integrated to and processing instant payments from the RTP^® system, operated by The Clearing House^® (TCH), since January 2021.* We currently participate in the FedNow pilot with three SHAZAM Core clients as “beta banks.” The pilot is expected to conclude in Q3 2023, when three SHAZAM clients will be among the first financial institutions in the country to go live into production with FedNow.

The Fed hasn’t announced general market availability for FedNow yet, but it’s expected to open up in Q4 2023. Later this year, we plan to make our SHAZAM FedNow Credit Receive service generally available. Enrolled FIs can offer their accountholders (consumers, businesses, or government entities) instant funds availability on credit transfers received, within seconds of payment initiation, along with immediate interbank settlement for each transaction, 24/7/365.

Types of payments your accountholders may receive via FedNow include: instant payroll deposits and advances, instant transfers from a digital wallet or money management application, account-to-account transfers from accountholders at other FedNow participant FIs, loan proceeds, payments on accounts receivable, and federal government payments from the U.S. Treasury.

Key benefits to your FI include meeting consumer demand for convenience and immediate availability of funds, improved customer service with faster and better payment methods, staying current with emerging payment innovations, remaining competitive with what the largest U.S. banks are already offering, and retaining customers who want to receive instant payments.

If your FI is interested in signing up for our SHAZAM FedNow Credit Receive service when it becomes available, you can prepare now by:

Getting familiar with the “FedNow Rules” which consist of the following documents:
After reviewing those documents, your FI will need to execute agreements directly with the Fed to become a FedNow participant through SHAZAM as your service provider:
- Operating Circular 8 – Funds Transfer Through the FedNow^SM Service Appendices A and B
- Operating Circular 1 – Account Relationships – Appendix 2 – Transaction and Service Fee Settlement Authorization Form. This agreement is only required if you plan to designate a correspondent bank as your agent to receive interbank settlement for your FI’s FedNow transactions. You may want to start discussing this with your correspondent bank now to be sure they are willing and prepared to support you in this capacity.
Consult your legal, risk and compliance experts to identify any additional planning considerations.
Review and plan to extend your SHAZAM processing agreements to include FedNow Credit Receive services.

Please contact your SHAZAM regional director if you have any questions about SHAZAM’s FedNow or RTP instant payment service offerings. For detailed information about the FedNow Service, visit FRBServices.org.

* You can sign up for RTP processing services through SHAZAM today.