Payments

The payments landscape for community banks is changing rapidly as traditional payments converge with new instant payment systems and emerging cryptocurrencies. It is critical for Community Banks to maintain awareness of developments in the payments space to assess new opportunities, mitigate risks, and ensure that their payment strategy aligns with overall business plans.

Payments News

As Senate meets on stablecoins, ICBA urges coordinated approach

Policymakers should take a comprehensive, coordinated regulatory approach to stablecoins and other digital assets, ICBA told the Senate Banking Committee.

Statement: In a written statement for a hearing on stablecoins, ICBA said:

  • Community bank involvement within a rigorous and thoughtful regulatory framework will help mitigate risks presented by stablecoins and other cryptocurrencies.

  • Stablecoin risks include eroding monetary authority, threatening financial stability, and risking community bank disintermediation.

  • Congress should ensure stablecoins are subject to appropriate federal prudential oversight that includes the Securities and Exchange Commission and the Commodity Futures Trading Commission.

Republican Principles: The committee’s Republican members on Tuesday released principles to guide stablecoin legislation that disagrees with a President's Working Group report that recommended requiring stablecoin issuers to be insured depository institutions. Instead, the principles would allow stablcoin issuers to choose from at least three regulatory regimes, including operating with a conventional bank charter.

Next Steps: While the broader debate over digital asset oversight continues, federal banking regulators recently said they plan to provide greater regulatory clarity on crypto-related activities next year. The OCC separately issued an interpretive letter with guidance on stablecoins and other digital assets.