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Fedwire® Funds Service Business Continuity Guide

Difficulty Accessing the or Using Fedwire Funds Service

Overview

The Fedwire Funds Service (the Service) is a real-time gross settlement (RTGS) system that is owned and operated by the Federal Reserve Banks. The Fedwire Funds Service provides a national network in which over 5,000 participants may send and receive time-sensitive payments. Typically, when a sending participant initiates a funds transfer message, the Fedwire application: (1) authenticates the sender, (2) edits the message for proper syntax, (3) debits the payment amount from the sender's reserve account and credits the same amount to the receiver's reserve account, (4) sends an acknowledgement to the sender to confirm the outgoing payment, and (5) sends an advice to the receiver for notification of the incoming payment. Payments processed over the Fedwire Funds Service are made in central bank money and are final and irrevocable once made.

The Federal Reserve Banks have a number of procedures in place to ensure the resilience of the Service and the Fedwire Securities Service (the Fedwire Services), including out-of-region backup facilities for the Fedwire applications and all integral support and related functions. The Federal Reserve Banks routinely test Fedwire business continuity procedures across a variety of contingency situations, including unavailability of facilities, hardware, network, or staff, to ensure timely resumption of Fedwire operations in the event of a local, regional, or widespread disruption. Furthermore, the Fedwire applications and associated recovery procedures are regularly enhanced and tested to address emerging risk scenarios, such as those that might occur during a pandemic.

How You Should Prepare

What You Should Do During the Disruption

If your institution is experiencing any issues with the Fedwire Funds Service, including difficulty accessing the Service or sending or receiving messages:

  • Review your internal systems for anything that may be causing these issues, and if applicable, contact any organization that provides software that facilitates your use of the Service and/or that your institution uses to connect to the Service.
  • Check for any operational status updates and information regarding service disruptions distributed by the Federal Reserve Banks:
    • Refer to the Service Status page for current operational status updates and other instructions. Status updates posted to the Service Status page may contain advice regarding actions to take during a service disruption.
    • The Federal Reserve Banks may also distribute service status updates and advice on actions to take during a service disruption via posts on FedLine Home and emails sent to EUACs.
    • Any issues or questions that are not addressed by these updates should be directed to the Customer Contact Center or your Wholesale Operations Site.
  • Notify all pertinent personnel at your institution about the issues you are experiencing and any service disruption, according to your specific crisis communication escalation procedures.
  • Monitor your account balances to prevent overdrafts and be prepared to use contingency funding resources such as the Federal Reserve Discount Window, if necessary.
    • If you subscribe to Account Management Information Services (AMI), you can view your account balance and a summary of the transaction-level activity posted to your account using the FedLine Web® Plus solution. If you are unable to access AMI, please contact your Wholesale Operations Site for assistance.
  • For questions related to reserve administration, overdraft, or borrowing, select your district on Discount Window/Payments System Risk (Off-site) or use the Reserve Central District Contacts page on FRBservices.org.
  • You may want to consider using alternative arrangements to send messages that you have not previously sent to the Fedwire Funds Service. It is critical that you reconcile messages you believe you had sent or received up to the point of the disruption before you use alternative arrangements to send new messages. You are advised not to use alternative arrangements to resend messages that you have previously sent to the Fedwire Funds Service if you are unsure whether they have been or will be processed by the Service. If you do so, you risk sending duplicate messages.
    • For FedLine Direct customers with online access through the FedLine Advantage solution, you may be able to use that access solution to originate new messages. FedLine Advantage customers with a contingency third-party service provider arrangement may be able to use that arrangement to originate new messages.
    • If you have an account or line of credit with a correspondent that is not affected by this disruption, your correspondent may be able to originate messages on your behalf.
    • Depending on the nature of the disruption, the Fedwire offline service may be available if you have a limited number of critical transactions that must be processed before the disruption is resolved; however, the Fedwire offline service is not designed or intended to support a broad-based FedLine Advantage service disruption and is not a viable contingency alternative for customers that use the FedLine Direct Solution.
      • During a disruption, call volumes may exceed operational capacity resulting in busy signals and/or long wait times, so please prioritize your payments before using the Fedwire offline service.
      • It is critical that your institution be familiar with the offline security procedures, including having authorized individuals available to originate and verify transactions using valid code words assigned to your institution by the Federal Reserve Banks.
  • If your institution requires an extension to the normal Fedwire Funds Service operating hours and you meet the criteria set forth in the Fedwire Services Extension Guidelines, please contact the extension request line as noted in the guidelines. The Federal Reserve Banks will communicate any extensions via the Service Status page.
  • General questions regarding a service disruption may be directed to the Customer Contact Center. For specific questions about the Fedwire Funds Service, please contact your Wholesale Operations Site.

Your institution is able to send messages, but is not receiving incoming advices and/or acknowledgments:

  • In accordance with section 8.2 of Operating Circular 6, you should notify the appropriate Federal Reserve Bank promptly if you are not receiving acknowledgments of submitted messages.
  • Review your internal systems for anything that may be causing these issues, and if applicable, contact any organization that provides software that facilitates your use of the Fedwire Funds Service and/or that your institution uses to connect to the Service.
  • You may continue to submit new messages even if you are not receiving acknowledgments. Customers are advised to refer to the Service Status page for current operational status updates and other instructions.
  • Customers are advised not to resend messages, as this may result in duplicate transactions. However, FedLine Direct customers with a need to resend messages are advised to do so using the Possible Duplicate Message (PDM) indicator and the same endpoint and unique message identifier assigned by the sender (i.e., IMAD) in the original message.
  • If you have critical transactions to process but are unable to do so without receipt of undelivered advices, please contact your Wholesale Operations Site for assistance.
  • If you subscribe to AMI, you can view your account balance and a summary of transaction-level activity posted to your account using the FedLine Web Plus Solution. If you are unable to access AMI, please contact your Wholesale Operations Site for assistance.

What You Should Do After the Disruption is Resolved

If you are still experiencing issues with accessing or using the Fedwire Funds Service after the Federal Reserve Banks have announced the resolution of a service disruption, you should review your internal systems for anything that may be causing these issues, and if applicable, contact any service provider that provides software that facilitates your use of the Fedwire Funds Service and/or that you use to connect to the Service regarding these issues.

Reconciliation

Procedures are in place to ensure the resilience of the operation of the Service, which includes recovery to the point of the disruption. Following the resolution of a disruption, it is critical that you reconcile the messages you believe you had sent or received up to the point of the disruption before submitting additional messages to the Service. If you need assistance with the reconciliation process, please contact your Wholesale Operations Site.

To assist in the reconciliation process, you should gather any internal documentation that will aid in determining if all transactions you believe you had sent and received before the service disruption were processed by the Fedwire Funds Service. In addition, the following reports may be used to support the reconciliation process:

FedLine Direct customers
  • Endpoint Grand Totals1, 2: You can request this report, which provides a summary of the activity for a given endpoint. This report lists the total volume and value of messages sent (debits) and received (credits) for a given endpoint. It also lists the total number of nonvalue service messages sent and received as well as the next expected sequence numbers for messages to be sent and received. The report also includes the number of outgoing sequence numbers that were rejected, intercepted, and not received by the Fedwire Funds Service.
  • Gap Report1, 2: You can contact your Wholesale Operations Site to request this report, which provides a list of sequence numbers the Fedwire Funds Service did not receive for a given endpoint (i.e., gaps). There are two gap reports for a given endpoint: one for messages sent and one for messages received. As a result, you would need to request separate gap reports for messages sent and messages received for the given endpoint.
  • Detailed Summary: You can request this report, which provides basic information (i.e., sequence number, sender, receiver, type/subtype code, reference number, dollar amount, and processing status) for a range of messages sent or received (up to 50 messages at one time) for a given endpoint.

FedLine Direct customers with a need to resend messages are advised to do so using the Possible Duplicate Message (PDM) indicator and the same endpoint and unique message identifier assigned by the sender (i.e., IMAD) in the original message.

FedLine Advantage customers

The following features available in the FedPayments Manager – Funds application may assist FedLine Advantage customers in completing their reconciliation processes:

  • Account Balance: This feature provides the account balance for your institution.
  • Activity Summary: This feature provides the following information: summary information of the messages you sent and received via the FedPayments Manager – Funds application for the current business day, including total volume and value sent (debits) and received (credits); the number of messages pending or rejected; and a summary of messages that have not yet been processed by the Fedwire Funds Service.

Other Contingency Events Impacting Your Business Operations

Overview

Many financial institutions have survived severe regional weather events or other contingency events with minimal to no direct impact on their day-to-day operations thanks to careful business continuity planning. As stated in the Federal Reserve Banks’ operating circulars, financial institutions and their service providers are responsible for developing, testing, and executing their own contingency and recovery plans to ensure the resilience of their operations in a crisis situation.

Whether your plan is as complex as establishing a geographically diverse data center, or as simple as having an evacuation packet with essential items your staff may need to reconstitute operations at an alternate site, planning and preparedness will help reduce the operational impact from unexpected weather or processing challenges.

How You Should Prepare

Detailed information about business continuity planning is available on this page. Additionally, a Fedwire Services Contingency Event Preparedness Checklist (PDF) can be used as you prepare your business continuity plans to help mitigate the potential impact of a contingency event (e.g., pandemic, severe weather, or other disruption to your Fedwire transaction-processing capabilities) that requires staff to work remotely for an extended period of time. Your institution should also periodically test your ability to access your online connection to the Fedwire Funds Service from a remote location.

What You Should Do During the Contingency Event

  • Take Your Evacuation Package: If relocation is necessary, this packet should contain valuable materials to help you quickly re-establish Fedwire operations from an alternate site. This may include:
    • Access credentials
    • Fedwire offline code words
    • Internal operation procedures
  • Implement Your Contingency Procedures: Determine which contingency arrangement applies to the specific event and implement it. For example:
    • Transition to your out-of-region data center and/or your contingency connection (e.g., FedLine Advantage Solution).
    • Activate your pre-established “buddy bank” arrangements (i.e., a third-party service provider arrangement).
    • Identify critical transactions; authorized individuals may be able to use the Fedwire offline service to manually process a small number of critical transactions in the event their alternate access channels are inaccessible.
  • Contact Your Wholesale Operations Site: Alert your Wholesale Operations Site that you are in a contingency situation. The Wholesale Operations Site can help you work through your Fedwire processing options.
  • Review Fedwire Services Extension Guidelines: Ensure authorized individuals are aware of the Fedwire Services operating hours and extension guidelines.

Footnotes

1If you process traffic from multiple endpoints, you will need to request a separate report for each endpoint.

2In the event of a contingency situation in which the Federal Reserve Banks failover to an alternate site, the Federal Reserve Banks will automatically send an “Interim” Endpoint Grand Totals and a Gap Report to each FedLine Direct endpoint that had activity on the day of the contingency event. The Gap Report will be sent to each endpoint even if there were no gaps in sequence numbers for that endpoint.

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