Fintechs urge Congress to grant access to Federal Reserve payment systems

Financial technology firms such as Ramp and Stripe are continuing their push for access to Federal Reserve payment systems, hoping for progress on a bill currently pending in Congress. Executives from both companies recently spoke at a fintech conference, advocating for broader access to the Fed's payment rails, including Fedwire Funds Service, FedNow Service, and FedACH Services.

Jonah Crane, head of global regulatory and policy at Stripe, highlighted the inefficiency of the current system during a panel discussion on September 25. "Stripe has no access to a Federal Reserve master account, even though we settle lots of payments every day," he said, emphasizing the potential for safer and more efficient transactions for users.

The push for access is supported by the Payments Access and Consumer Efficiency (PACE) bill, introduced by Rep. Young Kim in April. The bipartisan measure aims to allow fintechs to use U.S. electronic payment systems under the oversight of the Office of the Comptroller of the Currency (OCC). The bill has gained support from both Democratic and Republican representatives, including Rep. Sam Liccardo and Rep. Pete Sessions.

Alissa Kratsios, head of global policy at Ramp, noted that Fed ACH access is particularly important for her company, as about 90% of its payments use that rail. She emphasized that the initiative is not about sidestepping regulation but ensuring well-regulated firms can apply for access with proper oversight. However, the bill's prospects for passage this year appear limited due to the upcoming midterm elections, and there is no Senate companion legislation.