First Internet Bank today announced its participation in a pilot program for the FedNow Service, the Federal Reserve’s instant payments network. This collaboration further evidences a commitment to digital banking and faster payments on the part of First Internet Bank, the nation’s first state chartered, FDIC-insured institution to operate entirely online.
Expected to launch in 2023 or 2024, the FedNow Service alleviates pain points often associated with instant payments for consumers, small businesses and financial institutions:
● Consumers will have more control over their personal finances, with the ability to avoid late fees and overdrafts, as payments and bills can be made on the due date, rather than days ahead.
● With real-time payments, small businesses receive funds immediately, increasing cash flow and significantly reducing the cost of checks and payment processing fees.
● Financial institutions will derive benefits associated with safe, efficient instant payments.
“Since its inception, First Internet Bank has sought to deliver a more flexible banking model to meet the evolving needs of our personal and small business customers,” said Anne Sharkey, SVP of Operations. “Our participation in the FedNow pilot allows us to bring two decades of leadership in the industry to foster change within the instant payment sector.”
In its role, First Internet Bank will help shape the pilot program’s features and functions, provide input into the overall user experience and ensure readiness before the program debuts.