Nick Stanescu, chief FedNow executive, said in an interview with PYMNTS that adoption has risen sharply. “We started with 35 institutions and now have more than 1,500,” he said. “Consumers and businesses want fast, convenient payments,” he said, and that demand is driving the growth.
Consumers Choose Speed, Nonbanks
Stanescu said the Federal Reserve’s research shows how quickly expectations are shifting. “Seventy-eight percent of consumers choose faster payments as their preferred option,” he noted. “Half of those hold balances with nonbank providers.” He added that this pattern shows how instant payments have become a way for banks and credit unions to compete directly with nonbanks that offer convenience and immediacy.
The data also shows that expectations are increasing, with 6 in 10 consumers saying it is important for their financial institution to offer instant payments. Among Gen Z consumers, 78% rate it as important, which is a 14-point increase from the previous year. “Instant payments are not becoming less important,” Stanescu said. “If anything, they are becoming more important.”
Businesses show the same pattern. Sixty-six percent of firms say they are likely to use instant payments if offered by their main financial institution, and those that do report 10% higher satisfaction. “These numbers are very telling,” Stanescu said.
Competition and Customer Pull
Stanescu said adoption is being driven both by customer expectations and by competition among banks. “Customers are pulling banks into this by expecting these experiences,” he said. “At the same time, competitive pressure is real.”
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He described how one large regional bank accelerated its FedNow Service implementation by 12 months. “They moved up their plans because customers were pushing them for instant payments and because they saw how quickly competitors were moving,” he said. “Competition works.”
Always On, Always Available
The core shift that instant payments bring, Stanescu said, is that they operate continuously, every hour of every day. “That is a game changer,” he said. “Think about being able to process an auto loan on a Saturday or Sunday and walk away with the vehicle — that’s the always-on nature of instant payments.”
Stanescu also pointed to the U.S. Treasury’s use of instant payments for federal disbursements. “That can make a tremendous impact, especially in disaster or emergency situations where speed of funds really matters,” he said. “Instant payments can deliver when timing is critical.”
Benefits Beyond Speed
Stanescu said that for treasurers and CFOs, the benefits go beyond moving money quickly. “Immediate availability of funds and finality of settlement are major advantages,” he said. “There are no callbacks. The funds are in your account, and you can use them right away.”
That certainty helps businesses improve cash flow management and strengthen relationships with both vendors and clients. “The ability to pay a supplier immediately or fund an investment instantly can make a real difference,” he said.
Instant payments also carry data with the transaction. “Rich data within payment instructions enable straight-through processing and faster reconciliation,” Stanescu told PYMNTS. “It is an operational efficiency that we do not talk about enough.”
Importance of Send Capabilities
Growth on the FedNow platform continues to accelerate. “We are seeing back-to-back quarters of double-digit growth from the first to the third quarter of 2025,” Stanescu said. “Volume on Saturdays and Sundays is strong, which means we are supporting seven-day-a-week commerce.”
To reach ubiquity, Stanescu said, financial institutions need to expand beyond receiving payments. “They need to lean into send capabilities,” he said. “Receiving payments is a good start, but once you enable send for your customers, whether consumers or businesses, there is a lot more value to capture. That is where we are just seeing the beginning.”
Smaller Banks, Credit Unions Join
Community banks and credit unions are also expanding their participation. “The service is flexible,” Stanescu said. “They can start by receiving payments to manage risk and then expand to send capabilities by segment.”
He noted that some smaller institutions begin with a limited set of customers, such as corporate clients, to gain confidence. “A few even limit sending to certain hours at first,” he said. “That is fine for a short time, but they should expand as they gain experience.”
Building a Broader Ecosystem
Stanescu said the FedNow Service’s mission extends beyond financial institutions and is targeted on enabling a broader ecosystem. As businesses begin to understand instant payments, banks can work with them to build new use cases.
He also called on FinTechs and third-party providers to move faster. “In addition to enabling send, they should be embedding instant payment capabilities in their applications,” he said. “If you are an ERP provider, bake in instant payments and include [the FedNow Service] as one of the payment options today, not tomorrow.”
Embedding instant payments, he said, will help deliver more frictionless and transparent ways to make and receive money across industries.
Front Row Seat to Change
Stanescu said the pace of innovation in payments is accelerating across the industry. “It is an exciting time to be in payments,” he said, adding that “we have a front row seat to help facilitate and support this change.”
Nick Stanescu is chief executive of the Federal Reserve’s FedNow Service.
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