As mentioned by a few folks elsewhere in these comments, if FedNow is wildly successful and takes a meaningful portion of payments, it centralizes information about lots of peoples' financial activity in one place, across banks and across payment platforms. This potentially leads to FedNow being a one-stop OLTP shop for governments to run queries against realtime data, or even build stream processing agents that filter or take action on patterns.
Currently, it would be more difficult to build this database as it's hodgepodged together from suspicious activity reports and subpoenas. There's of course the unknowable possibility that law enforcement and security agencies have secret ways of building a comprehensive realtime dataset - but, if they do exist, their secret nature reduces the scope of situations in which they can be used.
ACH is slow and coarse, FedNow is capable of being realtime and fine-grained. Two institutions might have one giant ACH per day between them that includes a ton of smaller transactions that are all invisible to the ACH system itself.
As mentioned by a few folks elsewhere in these comments, if FedNow is wildly successful and takes a meaningful portion of payments, it centralizes information about lots of peoples' financial activity in one place, across banks and across payment platforms. This potentially leads to FedNow being a one-stop OLTP shop for governments to run queries against realtime data, or even build stream processing agents that filter or take action on patterns.
Currently, it would be more difficult to build this database as it's hodgepodged together from suspicious activity reports and subpoenas. There's of course the unknowable possibility that law enforcement and security agencies have secret ways of building a comprehensive realtime dataset - but, if they do exist, their secret nature reduces the scope of situations in which they can be used.
How is that different from ACH?
ACH is slow and coarse, FedNow is capable of being realtime and fine-grained. Two institutions might have one giant ACH per day between them that includes a ton of smaller transactions that are all invisible to the ACH system itself.
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