US Lawmakers Introduce PACE Act to Open Federal Payment Systems to FinTechs

Most transactions handled by US payment apps must pass through partner banks to gain indirect access to the Federal Reserve's FedACH, Fedwire and FedNow systems. These layers of intermediaries can slow settlement and increase fees. The PACE Act would give regulated nonbank payment providers a direct route to certain systems, with implications for FinTech competition, fund security and payment costs for small and medium-sized businesses.

On April 21, 2026, Republican Representative Young Kim and Democratic Representative Sam Liccardo introduced H.R. 8395, which was referred to the House Financial Services Committee. Providers would need at least 40 state money transmitter licenses and would have to register with the Office of the Comptroller of the Currency. Customer funds would have to be segregated and fully backed at a ratio of at least 1:1. Approved providers could then apply for access to designated Federal Reserve payment systems.