Fed weighs direct payment access

Federal Reserve Board requests public comment on a proposal to establish a "payment account," which legally eligible financial institutions could use for the specific purpose of clearing and settling their payments

1. Frame 1The Federal Reserve opens public comment on a payment-account rule for institutions seeking direct federal payment access.
2. Frame 2A widening range of eligible financial institutions wants Fed payment services to cut costs and speed settlement.
3. Frame 3Many applicants are not federally insured, raising supervision questions before they reach Reserve Bank accounts.
4. Frame 4Payment-account holders would get payment services, but no intraday credit, discount-window access, or balance interest.
5. Frame 5The Fed would set closing-balance limits from expected payment activity and pause some Tier 3 requests.
6. Frame 6The public has 60 days after Federal Register publication to shape the final account-access policy.