Blayne Furey is Vice President and Management Information Systems Officer at Freedom Bank (Off-site), a small and locally owned community bank.
We recently spoke with Furey to hear more about her experience as a FedNowSM Pilot Program participant focused on establishing a foundation for instant payments at Freedom Bank.
Q: First, why is access to instant payments important to Freedom Bank and its customers?
A: “Our customers count on us when they have important and time-sensitive payments to make, and instant payments will be another tool in our toolkit. Our wire payment activity has more than doubled over the past five years and is on track to continue growing. Some of this was caused by shifts during the pandemic, but we recognize the growing demand for same-day funds delivery and settlement. Instant payments will allow us to offer the same finality but with the added benefits of instant delivery and the elimination of time restrictions we see with other payment methods.”
Q: Can you describe Freedom Bank’s experience in the FedNow Pilot Program?
A: “Being engaged in the FedNow Pilot Program helped us get up to speed with our peers who are already offering real-time payments or person-to-person services. We have learned a lot from them, yet I also feel like we've had the opportunity to provide a fresh perspective. Overall, we know the FedNow Service will go a long way in helping community banks stay competitive in an evolving payments landscape, but we couldn't do this alone. It's nice to be among the other community banks and early adopters ready to take this leap with a service that we can feel confident about. And, because we work for a smaller community bank, our team felt it was important to engage and make sure we had a voice in this process.”
Q: What have been the biggest takeaways from implementation and resource planning so far?
A: “My team and I breathed a collective sigh of relief when we wrapped our heads around the credit push design of the service because it alleviated many of our concerns about fraud or potential scams. It's nice to have the option to participate as a receive-only institution, which we are considering as a first step in engaging with the service. It makes participation less of an intimidating jump for institutions like ours that are not yet participating in any form of instant payments.
“When we are ready to participate in sending instant payments, we will most likely engage with business customers as a starting point — it’s a way for us to mitigate risks more effectively given the relationships that we have established with these customers.”
Q: With the FedNow Service launch just months away, how close are you to being live on the service?
A: “This is not something that our 27-person staff is prepared to develop and launch on our own! We need strategic partnerships and are exploring service provider solutions to decide what customer-facing tools to use. We’ve also been meeting regularly with our core provider to make sure posting and settlement functionality is ready regardless of what other solutions we implement.”
Q: Do you have any advice for organizations in the beginning stages of planning?
A: “I think it's valuable to be engaged in the process of change rather than being a passive recipient, and I encourage financial institutions to start with the questions keeping them up at night. At this stage, we realize that many of our initial pain points were based on fear of the unknown. It wasn’t until we had those questions in front of us that we fully understood there were straightforward solutions, plus the flexibility to offer instant payments in a way that makes sense for us.”
Pioneers of Now represent engaged financial institutions and service providers united by their commitment to early adoption of the FedNow Service (Off-site), which will launch in July 2023. This is the fifth in a series of ongoing Pioneers of Now features (Off-site).