Federal Reserve Publishes Guidance For FedNow RFPs
Market practices have been released to standardize the implementation of instant payments
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- Written by Banking Exchange staff
The Federal Reserve has issued market practices for the request for payment (RFP) feature of FedNow, the instant payment system that it launched in July.
RFP can be used by financial institutions and service providers to help their customers manage cash flows with instant payments.
The recommendations have been developed by an industry work group of more than 90 organizations to serve as market practices that will create and promote standardized and effective RFP implementation across the industry.
The practices include recommendations on enrolling and enabling billers and customers to send and receive RFPs and specific criteria for populating and presenting clear RFP messages.
Alberto Casas, senior vice president at US Bank, said: “In working with a wide range of clients on RFP solutions, we understand consistent user experiences are crucial to driving more adoption. Standardizing customer enrollment and end-to-end experiences will help drive the scale that is needed for RFP to be a widely used payment feature in the future.”
The recommendations also aim to create the consistency needed to increase the participation of banks and credit unions.
While the market practices focus on consumer-to-business bill payments, some of them could also apply to other RFP use cases. They have been designed to be immediately applicable for financial institutions and their service providers.
The Federal Reserve also updated its FedNow Service Operating Procedures to provide further clarity on RFP warranties.
The new procedures include the meaning of legitimate purpose with respect to RFPs, guidance on the scope of the warranty provided when a financial institution sends an RFP, and procedures for initiating claims related to alleged breaches of RFP warranties.
