Astra launches first end-to-end instant payment solution with FedNow
Today, we are excited to announce the launch of the first end-to-end, commercially available solution leveraging the Federal Reserve’s newly released real-time push payment infrastructure, FedNow. This new API-based solution from Astra allows fintech products and enterprises to process instant payments from debit cards directly to bank accounts through the FedNow Service.
Why FedNow, now?
Officially launched in July 2023, the FedNow Service provides individuals and businesses with a fast, secure, and convenient way to send money on the Fed’s bank rails 24/7/365. By integrating with the FedNow Service, Astra expands the number of use cases and payment flows available to its customers, making it even easier for them to adopt instant payments with this new offering.
Before FedNow became available for usage in production in July, leveraging real-time payments meant building products with Visa Direct, Mastercard Send, or RTP by The Clearing House. The launch of FedNow expanded the options for “push” payments that settle immediately, and it ushered in a new wave of excitement around instant payments – a significant milestone for consumers, businesses, banks, and fintech!
But with every new innovation comes the hype! Last summer also included many proclamations around how FedNow would change payments, but left us all seeking “concrete features” (hat tip Simon Taylor) that the industry could actually deploy and use. FedNow did change payments, adding more bank coverage, but also more complexity with it. More “rails” means more settlement nuances and more opportunities to be exposed to risk.
For over a year, Astra has been hard at work understanding, contributing to, and building with the FedNow Service so that everyone, developers to enterprises, can innovate and grow through the opportunities that FedNow represents. Enter the first-of-its-kind, end-to-end payment solution that pairs FedNow with other payment methods while intelligently and automatically routing transactions to FedNow based on connectivity to the FedNow Service!
What’s unique about Astra’s solution?
Unmatched flexibility: Astra’s solution allows businesses to leverage FedNow within a transfer flow in combination with other payment types. For example, a developer can now process a transfer from a Visa debit card to a checking account via FedNow. Alternatively, funds could be debited from a checking account that is not accessible with FedNow through the ACH network and then be deposited into a different bank account via FedNow.
Maximum compatibility: Astra’s solution provides organizations with a level of flexibility unmatched in the payments ecosystem, with maximum compatibility across financial institutions. This means that developers can now use real-time payments for the broadest set of use cases, with smart settlement and routing designed for scalability, all through the same Astra API that offers a wide range of real-time payment options.
Benefits for Astra customers
All current Astra customers enabled for card-based transfers will automatically have access to FedNow functionality through their existing integrations, adding even more functionality to their applications. This will allow Astra customers to offer their users instant payments without additional development or reconsidering their own product infrastructure.
And while FedNow adoption is scaling, not all checking accounts are currently addressable. Astra’s solution defaults to FedNow, but confirms eligibility for the transfer before transfer initiation. This means if the account cannot be addressed via FedNow, the credit will land via RTP or ACH instead, requiring no additional actions from a developer.
What does this mean for the future of payments?
The payments ecosystem is undergoing a radical change, with new payment methods early in their adoption. There are an increasing number of payment “rails,” and new products coming to market have more diversity for their product “stack” (sponsor bank, banking-as-a-service provider, etc.). Developers and product owners have more to build and configure than ever, with the demand and expectation for real-time settlement only growing.
Instant payments are the future of payments, and Astra is committed to helping its customers adopt this new technology quickly and easily. With Astra, businesses can offer their customers numerous payment options to choose from, including real-time payments, without having to manage multiple payment providers.
Astra’s launch of the first end-to-end instant payment solution with FedNow is a significant milestone for the payments industry.
If you want to leverage instant payments, including FedNow, in as little as a few weeks, reach out to the team at Astra, and let’s get building!
