First Internet Bank Selected for FedNow Service Pilot Program

Rhea-AI Summary

First Internet Bank has joined the pilot program for the FedNow Service, the Federal Reserve's instant payments network, affirming its dedication to digital banking. The FedNow Service, set to launch in 2023 or 2024, aims to enhance payment experiences for consumers and small businesses, allowing for immediate funds transfer and improved cash flow. The bank will influence the pilot's development, ensuring readiness for its debut. As of December 31, 2020, First Internet Bank had assets totaling $4.2 billion.

Positive

• Participation in the FedNow pilot program showcases commitment to digital banking.
• FedNow Service will allow consumers to manage finances more effectively by making payments on due dates.
• Immediate fund transfer for small businesses will improve cash flow and reduce processing costs.

Negative

• None.

First Internet Bank today announced its participation in a pilot program for the FedNow Service, the Federal Reserve’s instant payments network. This collaboration further evidences a commitment to digital banking and faster payments on the part of First Internet Bank, the nation’s first state chartered, FDIC-insured institution to operate entirely online.

Expected to launch in 2023 or 2024, the FedNow Service alleviates pain points often associated with instant payments for consumers, small businesses and financial institutions:

• Consumers will have more control over their personal finances, with the ability to avoid late fees and overdrafts, as payments and bills can be made on the due date, rather than days ahead.
• With real-time payments, small businesses receive funds immediately, increasing cash flow and significantly reducing the cost of checks and payment processing fees.
• Financial institutions will derive benefits associated with safe, efficient instant payments.

“Since its inception, First Internet Bank has sought to deliver a more flexible banking model to meet the evolving needs of our personal and small business customers,” said Anne Sharkey, SVP of Operations. “Our participation in the FedNow pilot allows us to bring two decades of leadership in the industry to foster change within the instant payment sector.”

In its role, First Internet Bank will help shape the pilot program’s features and functions, provide input into the overall user experience and ensure readiness before the program debuts.

The Federal Reserve has direct connections with more than 10,000 banks allowing all parties, including smaller financial institutions, to benefit from the FedNow Service. For more information about the Federal Reserve and the FedNow Service, visit www.frbservices.org/index.html. For more information about First Internet Bank, visit firstib.com.

About First Internet Bank

First Internet Bank opened for business in 1999 as an industry pioneer in the branchless delivery of banking services. With assets of $4.2 billion as of December 31, 2020, the Bank provides consumer and small business deposits, consumer loans, residential mortgages and specialty finance services nationally. The Bank also offers commercial real estate loans, commercial and industrial loans, SBA financing and treasury management services. Additional information about the Bank, including its products and services, is available at www.firstib.com. The Bank is a wholly-owned subsidiary of First Internet Bancorp (Nasdaq: INBK). First Internet Bank is a Member FDIC.

View source version on businesswire.com: https://www.businesswire.com/news/home/20210331005666/en/

FAQ

What is the FedNow Service that First Internet Bank is participating in?

The FedNow Service is the Federal Reserve's instant payments network, designed to provide real-time payment capabilities.

When is the FedNow Service expected to launch?

The FedNow Service is expected to launch in 2023 or 2024.

How will the FedNow Service benefit consumers?

Consumers will have more control over finances, avoiding late fees as payments can be made on their due dates.

What impact will the FedNow Service have on small businesses?

Small businesses will receive funds immediately, which will enhance cash flow and lower payment processing costs.

What are the total assets of First Internet Bank?

As of December 31, 2020, First Internet Bank had assets of $4.2 billion.