Data network Plaid has revealed its upcoming support for FedNow, a real-time payment system, in its Instant Payouts feature on Plaid Transfer.
The move is a response to the growing demand for on-demand, real-time payment services from businesses and consumers.
Plaid Transfer, a versatile platform, will offer multi-rail support, enabling users to access a range of payment options, including ACH (Automated Clearing House), RTP (Real-Time Payments), and the upcoming FedNow service.
Additionally, the system will incorporate intelligent features to assess account eligibility for instant payouts and facilitate dynamic routing for transactions between FedNow, RTP, and ACH (Same Day or standard)
A significant aspect of this development is the expanded partnership between Plaid and Cross River Bank, known for providing embedded financial solutions.
Cross River will be among the first bank partners to offer support for Plaid’s real-time payment solutions, underlining its commitment to financial innovation and delivering faster, more secure, and seamless payment experiences.
Adam Goller, head of fintech banking at Cross River, said: “By combining the strengths of our proprietary banking core and advanced API technology with Plaid’s expertise in financial technology tools, millions of Plaid customers will have access to their money when and where they need it.”
Cross River’s selection as the inaugural financial institution to support Plaid’s real-time solutions was driven by their strong existing relationship and Cross River’s proprietary API technology, which enables efficient and streamlined connections to multiple payment networks, including ACH, RTP®, and the upcoming FedNowSM Service.
John Anderson, head of payments at Plaid, highlighted the advantages of real-time payments for businesses and consumers, stating: “Real-time payments can deliver significant efficiency and cost benefits to businesses and help them deliver amazing new experiences for consumers by delivering money when and where they need it.”
Traditional banking methods for payouts often take several days to settle, causing disruption to both businesses and consumers. However, a 2022 AFP Digital Payments Survey revealed that faster payments have had a positive impact on 92 per cent of global organisations, and 70 per cent of consumers reported satisfaction from quicker payment processing, according to the Federal Reserve.