What’s the difference between RTP® and FedNow?

What’s the difference between RTP® and FedNow?

• Feb 14, 2023
• Knowledge

Information

Title
What’s the difference between RTP® and FedNow?

Summary
FedNow is expected to launch in 2023, giving businesses and individuals the ability to send and receive instant payments through participating financial institutions.

The Federal Reserve, the United States’ central banking service and governing body behind the FedNow Service, describes its offering like this:

“The FedNow Service is a new instant payment service that the Federal Reserve Banks are developing to enable financial institutions of every size, and in every community across the U.S., to provide safe and efficient payments in real time, around the clock, every day of the year.”

The Clearing House launched RTP®, a real-time payment system, in 2017. The Clearing House operates the RTP® network, a payment rail currently reaching 61% of U.S. demand deposit accounts (DDAs).

FedNow and RTP will operate on different payment rails (FedNow uses the FedLine network and RTP uses the RTP network), but financial institutions can participate in both networks.