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FedNow hikes transaction limit increase from $500,000 to $1 million to support higher-value use cases; also enables defining dollar value and transaction velocity thresholds based on customer segments

June 26, 2025 //  by Finnovate

A new account activity threshold feature is now available for the FedNow Service, allowing financial institutions to strengthen risk mitigation efforts by defining dollar value and transaction velocity thresholds based on customer segments. The new functionality coincides with a transaction limit increase from $500,000 to $1 million to support higher-value use cases, including business-related transactions. “These new value-added features offer FedNow participants more options to customize their instant payments profile, adding to the suite of available tools that allow financial institutions to tailor activity according to risk management needs and customer activity,” said Mark Gould, chief payments executive for Federal Reserve Financial Services. “Feedback from the industry has been invaluable, and we intend to remain agile and responsive to new and changing customer needs as instant payments grow and mature.” Account activity thresholds provide further control as more financial institutions enable “send” capabilities on the network. Financial institutions can set parameters around sending activity for a wide range of customer segments, from established business customers to new individual account holders, as an additional level of security. “With these controls, our customer base of community banks will have more confidence in expanding their instant payment capabilities, especially when it comes to ‘send’ functionality, which will ultimately help all financial institutions remain competitive in the marketplace,” said Brooke Tiedt, senior vice president, payments and cash management at Bankers’ Bank. “The ability to add controls based on specific customers helps set the FedNow Service apart from other payment offerings.” The FedNow Service is nearing its second anniversary with approximately 1,400 banks and credit unions on the network across all 50 states. Community banks and credit unions make up more than 95% of total participants.

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