Federal Reserve Proposes Limited Payment Accounts for Eligible Financial Institutions

The Federal Reserve on December 19 requested public comment on a proposal to offer limited "payment accounts" to certain financial institutions, BlockBeats reports. The accounts would allow eligible institutions to use the Fed's payment services for clearing and settlement while excluding broader benefits available to banks, such as interest earnings and credit facilities. Fed Governor Christopher Waller said the accounts could "support innovation" while maintaining payment system safety. Under the proposal, the payment accounts would be distinct from master accounts, would not earn interest or provide Fed credit facilities, and would be subject to balance caps; Waller first suggested the concept in October last year.