Get access to the FedNow Service via Plaid Transfer

We are excited to announce plans to support the FedNow Service®, another important milestone as we move toward mainstream use of instant, native bank payments in the U.S. Moving money faster matters - whether it's a cash advance, payroll to cover necessary expenses or an emergency withdrawal, and is a step towards our mission of unlocking financial freedom for everyone.  

Plaid will enable FedNow access on Plaid Transfer, our flexible platform to manage bank-linked transfers and payments. Through a single API, companies using Plaid Transfer can securely authorize payments, analyze risk, and facilitate money movement. Transfer is a multi-rail platform, supporting the three primary bank rails in the U.S. – ACH, RTP, and soon the FedNow Service. 

By September 2023, we plan to enable the FedNow Service within Instant Payouts on Plaid Transfer, a real-time multi-rail payout solution to send funds instantly and 24x7.  Since launching Instant Payouts earlier this year, we have seen massive interest and customers adopting it in use cases such as gig worker payroll, brokerage withdrawals, cash advances and commission payouts. Customers will benefit from expanded coverage for payouts with the addition of the FedNow Service. We have made it really simple to access the FedNow Service by providing intelligence if an account is eligible for instant payouts and dynamically routing transactions between the FedNow Service and RTP. Existing Instant Payouts customers will benefit from both payment rails. 

Creating a trusted environment for real-time payments

Plaid has earned the trust of 1 in 3 banked U.S. consumers as a reliable brand that securely connects them to digital financial services. To protect consumers and businesses from bad actors, we continuously enhance risk and fraud mitigation across the ecosystem.

Real-time payment rails offer instant and 24x7 access to money to consumers but can also be exploited by fraudsters. Through the breadth of the Plaid Network, we are uniquely positioned to help customers manage risk and fight fraud at scale. Our fraud detection mechanisms draw from a network of 12,000+ financial institutions and 8,000+ apps.

Plaid Identity Verification and the recently launched Beacon go beyond the obvious KYC compliance requirements to monitor changes to identity and risk profiles over time to prevent identity theft, synthetic ID fraud, and account takeovers. Plaid Identity prevents payout fraud by verifying ownership of a specific bank account at the time of linking and over time. As we continue to invest in our real-time payment solutions, we are adopting and evolving our products to detect fraud before the money moves. These solutions could include providing powerful insights about the linked bank account such as recent bank identity change, stolen or synthetic IDs, or sudden changes in transaction behavior.

Benefiting consumers and businesses 

Real-time payments benefit consumers and businesses in several ways, including better liquidity, faster access to funds, and improved transparency into current cash flow by eliminating settlement delays. We expect the FedNow Service to accelerate the transition to real-time payment rails in the US through support for more financial institutions, including smaller/regional banks and credit unions. 

Plaid serves a crucial role in enabling bank payments today, offering identity verification, account verification and risk assessment products, and by enabling a network of over 50 payment partners for account linking, risk assessment and processing. For more information about Plaid's support for real-time payments, please contact our team.