U.S. banks and credit unions that want to route cross-border payments through the Federal Reserve’s instant-payment rail have one day left to weigh in. The Federal Reserve Board’s proposal to let domestic institutions use intermediaries on the FedNow Service, filed as Proposal R-1891, closes for public comment on June 9, 2026. The change would extend a system built for domestic interbank settlement into the cross-border corridor for the first time, and the window for outside input shuts tomorrow.
Why the intermediary model changes FedNow’s original scope
When the Fed first detailed FedNow in August 2020, it described a 24x7x365 settlement rail designed to support instant payments inside the United States. The system was scoped to clear transactions between U.S. depository institutions, with no mention of correspondent banking chains or foreign endpoints. The April 2026 proposal rewrites that boundary. Under the new framework, a U.S. bank could initiate a FedNow transfer to an intermediary, which would then route the funds to a correspondent bank handling the international leg. That extra hop keeps settlement on the Fed’s own engine while pushing the final destination offshore.
If approved, the rule change is likely to shift the profile of traffic moving through FedNow. Cross-border transfers typically carry higher dollar values than domestic person-to-person payments, which dominate the current mix. A measurable rise in average transaction size within the first four quarters after launch would be the clearest early signal that the intermediary pathway is drawing volume, and future Federal Reserve transaction data releases would capture that shift. Without baseline volume disclosures from the Fed, though, outside analysts will have to wait for those periodic reports to confirm whether the channel gains traction.
Regulation J amendments and the June 9 deadline
The formal rule sits under the title “Collection of Checks and Other Items by Federal Reserve Banks and Funds Transfers Through the Fedwire Funds Service and the FedNow Service; Regulation J.” The Federal Register notice was published on April 10, 2026, starting a 60-day comment period. The proposal docket lists the comment deadline as June 9, 2026, under identifier FR-2026-0011-01 and proposal number R-1891. In an April 8 communication, the Board explained that U.S. banks and credit unions would be allowed to use intermediaries to transfer funds through FedNow, using a correspondent-bank example to illustrate how an international leg could be layered on top of the domestic system; that description appears in the Fed’s April announcement of the proposal.
For any institution, trade group, or consumer organization that wants to shape the final rule, the practical first step is to file a comment through the Fed’s official proposal portal before the end of business tomorrow. Comments submitted after the deadline may not be considered during the rulemaking process, and late filers lose the opportunity to have their specific operational or policy concerns addressed in the final Regulation J amendments.
Open questions the comment record has not settled
Several gaps remain in the public record. The Fed’s proposal and its Federal Register notice do not include quantitative projections for expected cross-border transaction volumes or settlement-cost savings. No correspondent bank or prospective intermediary has made a public commitment to participate, so the demand side of the equation is still theoretical. Anti-money-laundering and sanctions-screening procedures for the intermediary leg are also not spelled out in detail. The Fed emphasizes that existing Bank Secrecy Act and Office of Foreign Assets Control obligations continue to apply, but the operational division of labor between sending institutions, intermediaries, and foreign correspondents is left to bilateral or network agreements.
That leaves several practical questions for commenters to address. One is whether intermediaries should be required to provide standardized data fields back to the originating bank so that sanctions and fraud screening can be reconciled across jurisdictions. Another is how liability should be allocated when an instant payment is misrouted or blocked on the cross-border segment after settling irrevocably over FedNow. The proposal does not prescribe a specific dispute-resolution framework for these scenarios, instead relying on private contracts layered on top of Regulation J’s baseline rules.
There is also uncertainty about pricing. The FedNow Service has published a domestic fee schedule, but the proposal does not discuss how intermediaries might bundle or pass through their own charges for the international leg. Depending on how those economics evolve, the new pathway could either undercut existing wire services for certain corridors or remain a niche option used mainly by large corporate clients comfortable with bespoke arrangements.
Finally, the proposal does not clarify whether the Fed will publish disaggregated statistics on cross-border activity over FedNow, such as volumes by corridor or use case. Without that transparency, it will be difficult for community banks, credit unions, and consumer advocates to assess whether the intermediary model is expanding access to faster, cheaper cross-border payments or primarily serving a small set of high-value flows. Those unresolved issues are precisely what the current comment window is designed to surface, and the breadth and specificity of submissions received by June 9 will shape how far the final rule ultimately extends FedNow beyond its original domestic scope.
Warren Cohen is a finance writer based in Phoenix, Arizona, covering personal finance topics including credit, banking, and beginner investing. He earned his degree in business administration from Arizona State University and began his career working in consumer finance, where he gained direct experience with lending and credit systems. He now writes for personal finance websites and fintech platforms, focusing on clear, practical content that helps readers make informed financial decisions.
