Overview
- The Fed requested input on creating "payment accounts" for the limited purpose of clearing and settling an institution’s payments.
- These accounts would be distinct from master accounts, would not expand legal eligibility for Fed services, and could receive a streamlined review.
- Design features include no interest, no access to Federal Reserve credit, and balance caps intended to limit risk to the payment system.
- The public comment period will run for 45 days following publication of the notice in the Federal Register.
- Governor Christopher Waller endorsed the concept as supportive of innovation and safety, while Governor Michael Barr opposed it over insufficient clarity on anti-money-laundering and terrorist-financing safeguards for institutions outside Fed supervision.