Fed's Payment Access Deadline Passes Without Clarity on Recommendations

The Federal Reserve's deadline to submit its findings on expanding payment access to nonbank financial companies has passed, but it remains unclear whether the Fed met the deadline or what recommendations it might make.

Under an executive order from May 19, the Fed was tasked with examining the current laws and regulations surrounding financial technology innovation, including access to Reserve Bank payment accounts and services by uninsured depository institutions and nonbank financial companies. The order specifically asked the Fed to consider options for expanding direct access where the law permits and ways to mitigate risks to the payment system and financial stability.

However, in an August 31 letter to White House economic adviser Kevin Hassett, Federal Reserve Gov. Christopher Waller reiterated the Fed's view that it does not have the authority to expand legal eligibility for access to accounts and services. He stated that expanding eligibility would require legislative action by Congress.