What happened
- Specific facts/numbers: The Federal Reserve’s move builds on an April 8, 2026 proposal to amend Regulation J so FedNow participants can use intermediaries for transfers, allowing the service to handle the U.S. domestic leg of cross-border payments; the FedNow network has also been reported at roughly 1,700 participating institutions in current coverage.
- Institutions involved: The key institutions are the U.S. Federal Reserve Board, Federal Reserve Financial Services, FedNow participants including U.S. banks and credit unions, and correspondent or other intermediary banks used for the international leg.
- Regulatory/technical context: Current FedNow rules allow only two U.S. banks in a transfer. The proposed Regulation J change would align FedNow more closely with cross-border structures long used on Fedwire by permitting non-Reserve Bank intermediaries, supporting private-sector cross-border payment solutions.
- What to watch next: Watch for the Federal Reserve to finalize the Regulation J amendments and for rollout details on testing or production use of cross-border payment flows on FedNow; no specific next milestone beyond that was identified.
Why it matters
This would let U.S. banks plug instant domestic settlement into international payment chains, potentially speeding cross-border transfers without requiring FedNow itself to become a full end-to-end global network.
HKMA Relevance
Direct: This is a U.S. central-bank payments-rail change, and central-bank action on cross-border payments is directly relevant to the HKMA’s own payments and settlement agenda.