(a) Payment. A receiving
bank (other than a Federal Reserve Bank) that receives a payment order
from its Federal Reserve Bank authorizes that Federal Reserve Bank
to pay for the payment order by crediting, or causing any other Federal
Reserve Bank on whose books the settlement account is maintained to
credit, the amount of the payment order to the settlement account.
(b) Funds availability.
(1) A beneficiary’s bank (other than
a Federal Reserve Bank) that accepts a payment order over the FedNow
Service is obliged to pay the amount of the order to the beneficiary
of the order immediately after its acceptance of the payment order,
by crediting an account of the beneficiary in accordance with section
4A-405(a) of article 4A. The rights and obligations with respect to
the availability of funds are also governed by the Expedited Funds
Availability Act and the Board’s Regulation CC, Availability of Funds
and Collection of Checks.
(2) Nothing
in paragraph (b)(1) of this section or any operating circular issued
hereunder shall create any rights that the beneficiary or any party
other than a Federal Reserve Bank may assert against the beneficiary’s
bank, or affect any liability of the beneficiary’s bank to the beneficiary
or any party other than a Federal Reserve Bank under article 4A or
other law.
(3) In circumstances
where the beneficiary’s bank (other than a Federal Reserve Bank) has
reasonable cause to believe that the beneficiary is not entitled or
permitted to receive payment, the beneficiary’s bank may notify its
Federal Reserve Bank that it requires additional time to determine
whether to accept the payment order. In the event the beneficiary’s
bank gives such notice to its Federal Reserve Bank, for purposes of
this subpart and article 4A the beneficiary’s bank does not accept
the payment order upon its receipt of payment in the amount of the
payment order by a Federal Reserve Bank.
