- The Federal Reserve is adding cross-border capabilities to FedNow, allowing banks to use the instant payments network for the US leg of international transactions.
- Initial use cases include international payroll, corporate payments, insurance claims, and treasury management, with correspondent banks handling the international portion.
- The expansion strengthens FedNow’s position as stablecoins gain traction in cross-border payments, giving banks a faster, 24/7 option within established banking infrastructure.
The US Federal Reserve is improving its FedNow real time payment scheme this week. The organization is building out cross-border transaction support to allow financial institutions to meet needs of clients who conduct business across geographic borders.
Cross-border payment capabilities will allow institutions to support customers whose transactions involve sending and/or receiving funds to parties outside of the US for international payroll, corporate payments for global businesses, international insurance claims, and global treasury management. While FedNow is covering the US leg of the transaction, the organization is leveraging correspondent banking relationships to move funds on the international portion of the transaction, similar to how the Fedwire Funds Service operates.
“Cross-border transaction capabilities will give financial institutions powerful new ways to serve internationally active customers. After several years focused on growing the domestic instant payments market, this is an important first step toward meeting the global needs emerging across our ecosystem,” said FedNow Chief Executive, Nick Stanescu. “Participants have consistently told us that enabling cross-border use cases is a priority, and this milestone reflects our commitment to delivering on that feedback. It’s a meaningful step forward—and just the beginning of what’s to come.”
While the service is not currently live, a group of organizations will soon begin testing FedNow to send and receive the US domestic leg of cross-border payments. The organization said that all FedNow participants can adopt these new messages to support cross-border capabilities “soon.”
“Our upcoming integration with cross-border functionality supported by the FedNow Service reflects our commitment to providing financial institutions with a faster, more transparent solution for the US leg of international transactions, while elevating safety by un-nesting complex payments, screening each party instantly, and digitizing every risk and compliance process to deliver the highest standards our industry requires,” said Payall President and CEO, Gary Palmer. “As commerce increasingly demands instant execution across borders, we’re proud to support the infrastructure that makes this possible for our clients and their customers.”
FedNow went live in July of 2023 and now reaches 1,900 participating financial institutions, up from more than 1,500 at the end of 2025. While participation continues to expand, the Federal Reserve is still working to encourage institutions to activate and increase their use of both send and receive capabilities. Earlier this month, Federal Reserve Financial Services announced a new discount program launching in 2027 that will offer financial institutions incentives of up to $80,000 for enabling and scaling FedNow payments.
FedNow’s expansion into cross-border payments is strategic. While the network was built to give banks an always-on, real-time alternative for domestic payments, stablecoins increasingly offer many of those same benefits across borders. Stablecoins can move value around the clock without relying on the operating hours and intermediaries that have traditionally made international payments slower and more expensive. The Federal Reserve itself has acknowledged that stablecoins have the potential to become a faster, lower-cost alternative for cross-border payments.
That makes international functionality an increasingly important piece of FedNow’s value proposition. By allowing banks to use FedNow for the US leg of a cross-border transaction while correspondent institutions handle the international portion, the Federal Reserve is extending the speed and 24/7 availability of its instant-payment rail to more global use cases. It doesn’t eliminate the correspondent banking infrastructure the way some stablecoin-based payment models seek to, but it gives banks another way to deliver faster international payments while keeping settlement within familiar regulated banking infrastructure.
Photo by Alexas Fotos
