We need your input! Learn more about what we’re doing and lend your voice to our efforts by joining the Conversations on Instant Payments group!
The Project
CU*Answers is currently working on a multi-step process to connect to the new payment rail offered via the FedNow® Service from the Federal Reserve.
In order to allow all credit unions across the network an equal opportunity to hook into this new payments rail, we are pursuing a connection directly to the Fed, rather than going through a corporate credit union. CU*Answers clients will connect via the CU*Answers data center’s connection to the Fed; CU*South and CU*NorthWest clients will connect via the connection to the Fed at the Site-4 data center. Both will use the same network infrastructure, software, and server components on the back end.
Our first phase will allow CUs to jump on the rail for the FedNow Service in order to receive deposits to member accounts. After that we’ll tackle the send and request for payment (RfP) functions, which require a great deal more configurable controls and fraud mitigation components.
Projects related to this initiative (status is as of February 2025):
- Project #62452: Create an interface with the Federal Reserve for the FedNow Service real-time payments rail
Status: We have logged nearly 900 hours of development time so far. We have bi-weekly meetings with our onboarding team from the Fed, and bi-weekly internal team meetings to move the project along. We are currently about three-quarters of the way through a 38-step checklist, which includes development and connectivity work, testing, and many other tasks. Our champion credit union is Frankenmuth CU. We are on track to having Frankenmuth live on the Receive functionality, in a beta-test mode, in time to announce at our Leadership Conference in June. - Project #64185: Controls for Sending Funds via RTP or the FedNow Service
Status: We have logged over 200 hours of development on this project, which creates new configuration controls in CU*BASE so they’ll be ready to use with subsequent projects. Those subsequent projects will build the actual applications and user interface for sending funds via the new instant payment rails. Project is currently waiting for available QC testing resources as well as the completion of the project that connects us to the FedNow Service, already mentioned. - Project #64186: Add Instant Payments (RTP/FedNow) to CU*BASE Loan Disbursements
Status: This project is currently in development, and is our first application that will actually utilize the new instant payment rails to send funds, using existing loan disbursement features in the CU*BASE LOS. We have logged 80 hours of development so far.
Resources
Learn more about instant payments.
Learn more about the FedNow Service.
Sign up to be an early adopter of the FedNow Service – Receive-Only!
Read an overview of instant payments and the differences between the RTP and FedNow networks.
Open the FedNow Service Operating Procedures
Open the FedNow Service Operating Circular 8 (OC8)
FAQs
Q: Will this project change how ACH works?
A: No. Remember that this is a payment option that is separate from and in addition to regular or same-day ACH. Whatever we do with these new payment channels, either RTP or the FedNow Service, will have no effect on our current ACH processes and functionality.
Q: My corporate credit union said that they can hook us up to the FedNow service. Are you going to be working with corporates on this?
A: Not until after we have completed our integration direct to the Fed. Our plan is to complete all components of the project – Receive and Send at the very least, and possibly Request for Payment – before we open the door to working directly with any particular corporate CU’s solution. Remember that unlike RTP, which you can hook to without changing your existing relationship with your corporate credit union, the FedNow service will require a much greater level of entanglement with the corporate, which could be disruptive to some CUs. Our plan is intended to allow everyone across the entire network to tap into the FedNow service without having to alter their existing corporate CU relationship.
Q: Do I need to choose between RTP and the FedNow Service? Is there any reason to wait for the FedNow service to be ready?
A: Don’t wait! Your credit unions will need to be on both of these new payment rails! There is no interoperability between these independent payment systems, and members will not be able to pick and choose: if the payment app they are trying to use is on the FedNow service and your CU is only on the RTP rail (or vice versa), members won’t be able to send an instant payment using that tool. So get on board with RTP now, then plan to jump on the FedNow service later when it’s ready!
Q: I’m a self-processing credit union. Is there anything different I need to do if I want to hop on this rail?
A: Yes. We are still working through the details, but it is our understanding that our self processor partners can ride our rails for the FedNow service, but you will need to process the configuration in your own FRB portal. We cannot set you up like we can for our online clients. You will need to configure your FRB portal to point to our servers. Stay tuned for more complete instructions on how to do this once we figure everything out!
Q: I understand Corp One does have a connection to the FedNow Service. Can I just sign up for that now, before you get your direct connection done?
A: While this is technically available to anyone who is signed up for RTP through Corp One, CU*Answers has no specific interface earmarked for the FedNow traffic. That means that any transactions would come through as RTP and be logged under the same origin code in CU*BASE. We will not be considering any development to alter that arrangement until after we have gone live with our connection to the Fed and gotten a good start on our plans for the “Send” process.
Q: My credit union already has a FedLine Advantage terminal. Do we have to do anything different to sign up for this new service?
A: We’re still working with the Fed team to figure out and document the exact onboarding process, but we do know that CUs who already have their own FedLine Advantage connection will need to use their existing credentials to complete the necessary steps. We’ll either give you specific instructions to follow, or we may ask you to provide access to our team to make the necessary changes for you. Either way, we’ll walk you through the process from beginning to end.
Chefs for this recipe: Dawn Moore, Nicole Cooper, Jim Lawrence, Jeff Miller
