Fintechs to Get Direct Fed Access: PACE Act Could Slash Fees, Speed Payments

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Congressman’s PACE Act would plug fintechs directly into Fed rails

A proposed new law, the PACE Act, would allow eligible payment companies that aren’t traditional banks to connect directly to the Federal Reserve’s payment systems. This would lower costs and speed up transactions, and it complements existing legislation – the GENIUS Act – which regulates stablecoins.

Summary

  • The new PACE Act would let qualified non-banks plug directly into Fed payment systems.
  • Backers say it could cut delays and fees for U.S. consumers and businesses.
  • Fintech and crypto groups are lining up behind the bill’s push to open payments.

A member of Congress has introduced a new bill called the PACE Act. If passed, it would allow approved payment companies to directly connect to the Federal Reserve’s payment system, with the goal of updating and improving how payments are made in the U.S.

Bill aims to open Fed rails to non-banks

As I understand it from the latest market reports, this proposal would give regulated non-bank financial companies direct access to payment systems like Fedwire, FedACH, and FedNow. The goal is to make payments faster and cheaper for everyone – both consumers and businesses – by significantly reducing settlement times and overall transaction costs.

Industry groups in the fintech and cryptocurrency spaces have generally welcomed the new legislation. They believe it will speed up and lower the cost of payments in the U.S., making the system more competitive with other payment options and with countries developing similar technologies.

Fed access, passporting and crypto implications

According to a LinkedIn analysis, the PACE Act would establish a new federal designation called “Registered Covered Provider.” This would allow qualifying companies to apply for payment accounts directly from the Federal Reserve without needing to become fully licensed banks, and oversight would be handled by the Office of the Comptroller of the Currency.

Generally, a company needs to hold licenses in over 40 states to operate as a money transmitter, or have a state-chartered depository. This requirement is meant to cover large payment companies, services that send money, and major cryptocurrency businesses that already work across the country.

This analysis also indicates the bill would allow companies to operate in all 50 states with a single approval, simplifying the current complicated and expensive licensing process. It would replace the existing system with a national oversight body and clear financial requirements.

These new requirements are similar to the GENIUS Act, mandating that for every digital asset held, there must be an equal amount of readily available funds like cash, Federal Reserve deposits, or U.S. Treasury bills – or digital versions of these. This is intended to protect customers’ money and allow companies other than traditional banks to access funds held by the central bank.

As a crypto investor, I’m really interested in the potential of the PACE Act. It’s being pitched as a way to lower banking fees for everyday Americans, and I think that’s a smart way to frame it. Instead of looking like a win for fintech companies, it’s presented as a benefit for consumers – giving us access to payment systems that are cheaper, faster, and more dependable. Honestly, that’s a huge selling point for things like crypto and other innovative payment solutions.

If approved, this bill would join other recent developments – like the GENIUS stablecoin rules and new SEC guidelines for digital asset accounting – in fundamentally changing how U.S. financial markets work. It could let major cryptocurrency and payment companies send money directly through the Federal Reserve system, rather than always using traditional correspondent banks.

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2026-04-21 20:02