ICBA Reiterates Strong Concerns with Federal Reserve Payment Account Proposal

Press Release: Washington, D.C. (July 27, 2026) — The Independent Community Bankers of America (ICBA) today expressed strong concerns with the Federal Reserve Board’s proposed special-purpose payment accounts for nonbank financial institutions and urged the agency to ensure any such program is temporary.

“The Federal Reserve’s proposed payment account for eligible nonbank institutions continues to face an inescapable problem: the Fed shouldn’t extend direct access to its payment system to institutions that fall outside the prudential regulatory framework governing the banking system, which would put Americans and the U.S. financial system at risk,” ICBA President and CEO Rebeca Romero Rainey said today. “As we have repeatedly told the Fed, the agency should continue to limit account access to institutions that meet the financial services sector's highest standards and ensure that any ‘skinny’ account program is temporary and subjects nonbank participants to sufficient guardrails.”

In today’s comment letters, ICBA said access to the Fed’s accounts and services should remain tied to strong prudential oversight and that lightly regulated entities should not receive the same comprehensive access as insured depository institutions. ICBA also urged the Fed to ensure any payment account program is temporary and includes mandatory illicit finance requirements, does not offer a pathway to a full Fed master account, institutes transparency and public reporting, excludes account holders from the Fed discount window, and does not require the Reserve Banks to pay interest on balances, among other safeguards.

ICBA has repeatedly raised concerns with the Fed’s payment account proposal, including in a comment letter earlier this year on the agency’s request for information on the idea, in a recent letter on Kraken Financial’s access to a limited-purpose Fed payments account without a formal policy in place and despite the uninsured nonbank’s connection to crypto-kiosk fraud, and in an issue brief calling on policymakers to pause the payment account plan and other crypto policy developments to holistically assess their combined impact on local communities and the broader economy.

Today’s ICBA comments apply to the Fed’s overall payment account proposal, proposed amendments to Regulation A related to discount window access, and proposed amendments to Regulation D related to interest on reserve balances. ICBA looks forward to continuing to work with policymakers to ensure its proposals safeguard consumers and the nation’s financial system.

About ICBA
The Independent Community Bankers of America® has one mission: to create and promote an environment where community banks flourish. We power the potential of the nation’s community banks through effective advocacy, education, and innovation.

As local and trusted sources of credit, America’s community banks leverage their relationship-based business model and innovative offerings to channel deposits into the neighborhoods they serve, creating jobs, fostering economic prosperity, and fueling their customers’ financial goals and dreams. For more information, visit ICBA’s website at icba.org.