WASHINGTON— Two California lawmakers have introduced bipartisan legislation that would create a new federal pathway for nonbank payment companies to tap directly into the Federal Reserve’s payment rails, a move backers say could speed transactions and lower costs for consumers who use payment apps—but one that could also intensify competition for banks and credit unions that currently sit between fintech apps and the payments system.
The Payments Access and Consumer Efficiency (PACE) Act was introduced Tuesday by Reps. Sam Liccardo and Young Kim, according to the lawmakers’ offices and multiple reports.
Under the proposal, qualified nonbank providers would be able to access federal payment systems directly rather than routing transactions through partner banks, with coverage centered on FedACH and FedNow and broader reports indicating the framework is aimed at Federal Reserve payment infrastructure more generally. Sponsors said the bill is designed to reduce delays and fees that now occur when app-based payments pass through multiple intermediaries before settlement, Payments Dive said.
The bill, analysts stated, could erode some of the traditional advantage banks and CUs have as the regulated gateway to core payment rails, even as supporters frame it as a consumer-friendly modernization effort. The legislation would create an optional federal framework for payment-focused firms, with news reports stating it would involve oversight through the Office of the Comptroller of the Currency.
Fintech trade groups immediately lined up behind it. The Financial Technology Association called the measure a step toward “faster, cheaper, and safer” payments, and the lawmakers’ offices said the Blockchain Association, The Digital Chamber and the Crypto Council for Innovation also endorsed it.
There is no Senate companion yet, according to Payments Dive, meaning the bill remains an early-stage marker in a broader fight over who gets direct access to the nation’s payments plumbing. But the proposal could become highly relevant for credit unions if it gains traction, especially as policymakers continue debating faster payments, bank-fintech competition and the role of nonbanks—including crypto-linked firms—in the regulated financial system.