Fed System Will Ensure Broad Access and Stop Megabank Monopoly
Washington, D.C (Sept. 25, 2019)—The Independent Community Bankers of America® (ICBA) is testifying before two congressional committees this week on its strong support for the Federal Reserve’s decision to build a real-time payments system.
Robert A. Steen, chairman and CEO of Bridge Community Bank in Mount Vernon, Iowa, is testifying before the Senate Banking Committee today and the House Financial Services Committee's Task Force on Financial Technology tomorrow on how the FedNow system will ensure direct access to faster payments for all financial institutions and their customers.
"The Federal Reserve is uniquely positioned to provide access to real-time payments because it already provides payments services to nearly 11,000 financial institutions of different sizes and charter types," Steen said. "The Fed has not only the authority, but the duty, to build and operate our real-time settlement system. Now, the Fed must move quickly to establish the service."
Steen testified that the U.S. payments system lags much of the rest of the world in faster payments and that The Clearing House's for-profit payments network is a megabank monopoly unable to provide ubiquitous access to financial institutions and consumers. Fortunately, FedNow will ensure competition, choice, universal access and affordability while offering a platform for innovation that is a natural extension of the Fed's current payments role, he said.
ICBA and the nation's community banks have long supported the Fed’s role in real-time payments, as illustrated in messages to policymakers, op-eds, ads and hundreds of ICBA and community banker comment letters to the Fed. ICBA looks forward to continuing to work with the Fed as it develops and implements its system to maximize access for community banks and the local customers and communities they serve.
The Independent Community Bankers of America® creates and promotes an environment where community banks flourish. With more than 50,000 locations nationwide, community banks constitute 99 percent of all banks, employ nearly 750,000 Americans and are the only physical banking presence in one in three U.S. counties. Holding more than $5 trillion in assets, nearly $4 trillion in deposits, and more than $3.4 trillion in loans to consumers, small businesses and the agricultural community, community banks channel local deposits into the Main Streets and neighborhoods they serve, spurring job creation, fostering innovation and fueling their customers’ dreams in communities throughout America. For more information, visit ICBA’s website at www.icba.org.
# # #