The Federal Reserve Board recently issued a Service Announcement setting forth the details of its FedNow Service, a new 24x7x365 interbank settlement service with clearing functionality to support instant payments in the United States.

The Fed announced its decision to develop the FedNow Service in a notice and request for comment issued in August 2019. … Continue Reading

Acting Comptroller Brooks recently revealed the OCC’s plans to create a national payments charter for payment processing companies.  After discussing the new charter’s intended purpose and benefits, we look at the OCC’s planned two-phase roll-out, how a payments charter would differ from the OCC’s fintech charter, other charter options for non-bank payment processors, and possible legal challenges.… Continue Reading

As we reported, Acting Comptroller of the Currency Brian Brooks has previewed the OCC’s plans to introduce another special purpose national bank charter that would give payment companies a nationwide servicing platform and federal preemption of state laws regarding licensing and regulation of money transmitters and payment services providers.  Acting Comptroller Brooks’ statements drew swift reaction in the form of a July 29, 2020 letter from seven leading banking trade associations.… Continue Reading

The Senate Banking Committee will hold a hearing tomorrow, June 30, titled, “The Digitization of Money and Payments.”

The witnesses will include Charles Cascarilla, Chief Executive Officer and Co-Founder, Paxos, and Professor Nakita Q. Cuttino, Visiting Assistant Professor of Law, Duke University School of Law.

 … Continue Reading

The House Financial Services Committee’s Task Force on Financial Technology will hold a hearing entitled “The Future of Real-Time Payments,” at 2:00 p.m. on Thursday, September 26, 2019.  There will be a live webcast of the hearing.

The memo from the FSC Majority Staff indicates the hearing will focus on the development of a real-time payments (“RTP”) system and the risks, regulation, and market features of any future payments system.… Continue Reading

Last month, the Federal Reserve Board announced its plans to develop a real-time payments (RTP) service to be offered by the Federal Reserve Banks to directly support faster payments.

Three members of Ballard Spahr’s Consumer Financial Services Group with extensive experience negotiating complex payments transactions for some of the world’s largest retailers and financial institutions have authored an article in which they discuss the expanding adoption of RTP as a standard for payments transactions, including the commercial and contractual issues that may arise as a result.… Continue Reading

The Federal Reserve Board has determined that the Federal Reserve should take the following two actions:

  • Develop a new interbank 24x7x365 real-time gross settlement (RTGS) service to be offered by the Federal Reserve Banks to directly support faster payments and to be called the FedNow Service
  • Explore expanding the hours of the Fedwire Funds Service and the National Settlement Service (NSS), up to 24x7x365 to support liquidity management in private-sector RTGS services for faster payments

The Fed’s determination is set forth in a notice and request for comment issued on August 5, with comments to be due on or before 90 days after the date the notice is published in the Federal Register. … Continue Reading

I am pleased to announce that Judy Mok, an attorney with extensive experience negotiating complex payments transactions for some of the world’s largest retailers and financial institutions, has joined Ballard Spahr as Of Counsel in the firm’s Consumer Financial Services Group.  She will be based in the firm’s New York office.… Continue Reading

Earlier this month, the Federal Reserve invited comment on actions it can take “to promote ubiquitous, safe, and efficient faster payments in the United States by facilitating real-time interbank settlement of faster payments.”  Comments are due by December 14, 2018.

More specifically, the Fed is seeking comment on two potential actions. … Continue Reading