It would seem from the article here [0] that pricing for FedNow is $25/mo per routing number (which generally means per bank not per account, since many accounts at a bank share the same routing number) and about $0.05 per credit transaction. Not sure how that will be passed thru in costs from the bank(s) or if they will absorb what seems to be a small cost?
"The service will include a $25 monthly participation fee for every routing transit number enrolling in the service. Then there will be a $0.045 per credit transfer and one cent for a RFP message to be paid by the requestor."
And a routing transit number is a 9 digit number that identifies the bank, not the variable number that identifies each individual account [1]
"A routing transit number is a nine-digit number used to identify a bank or financial institution when clearing funds for electronic transfers or processing checks in the United States. A routing transit number is also used in online banking and clearinghouses for financial transactions. Only federally chartered and state-chartered banks that are eligible to maintain an account at a Federal Reserve Bank are issued routing transit numbers. "
Informally, a senior banker once told me that Interac E-transfer reduces bank transfer costs to less than a penny each. The $1-1.50 fee is pure profit, hence the availability of unlimited transaction plans.
For comparison, Square, which usually charges 2.65% of each transaction only charges a flat 10 cents for contactless Interac payments. Not technically e-transfers, but one imagines that the pricing model is roughly the same per transaction.
I should point out that Interac as a method of direct payment to online merchants by clicking a button on your vendor’s website/invoice has not had as much success. Only two banks and a handful of credit unions supported Interac Online Payment when I last checked, while basically all banks and credit unions in Canada now support Interac E-transfer. Going to a website and clicking Pay and signing in with your bank account to initiate the payment isn’t supported by most banks. Instead, the Interac E-transfer has to be initiated or responded to via the bank’s website. It also has nothing to do with the bill payments system, which often uses “EFT” (the Canadian version of “ACH”) to pay utility bills, etc.
The # of banks and financial institutions stays fairly stable so that covers the ongoing fixed costs. The number of transactions is highly variable so that covers the variable costs.
According to https://bank.codes/us-routing-number/bank/ there are around 18,000 current routing transit codes active, which would amount to about $5.4M annually if all 18,000 were enrolled in FedNow.
"The service will include a $25 monthly participation fee for every routing transit number enrolling in the service. Then there will be a $0.045 per credit transfer and one cent for a RFP message to be paid by the requestor."
And a routing transit number is a 9 digit number that identifies the bank, not the variable number that identifies each individual account [1]
"A routing transit number is a nine-digit number used to identify a bank or financial institution when clearing funds for electronic transfers or processing checks in the United States. A routing transit number is also used in online banking and clearinghouses for financial transactions. Only federally chartered and state-chartered banks that are eligible to maintain an account at a Federal Reserve Bank are issued routing transit numbers. "
[0] https://www.pymnts.com/news/faster-payments/2022/fed-release...
[1] https://www.investopedia.com/terms/r/routing_transit_number....