Fed payment account comment period closes; September deadline now the operative date for SMB payments strategy
The Federal Reserve’s public comment window on its proposed limited-purpose Payment Account closed on 27 July 2026. The proposal, published in May alongside President Trump’s executive order on fintech innovation, would create a new class of Fed account for nonbank and digital asset firms to clear and settle payments directly, without routing through a sponsor bank.
The Fed is now required to report to the President by 16 September 2026 on its legal authority to expand Reserve account access, the options available for doing so, and any legislative changes needed to remove existing barriers. That report is the next fixed point in the process and the one operators should be tracking.
Relevance for UK SMB operators
Direct implications are limited for firms operating solely in the UK. The indirect relevance is in counterparty risk and platform selection. Any US-based payment processor, embedded finance provider, or fintech partner an SMB operator relies on may be evaluating whether to pursue registered covered provider status under the parallel PACE Act (H.R.8395, introduced April 2026, no Senate companion yet) or direct Fed account access under this proposal. A shift in either process changes the settlement risk profile, cost structure, and operational dependency of any US-linked payment rail an operator is using or considering.
Adjacent development
The Payment Systems Regulator’s review of APP fraud reimbursement has moved from evaluation to roadmap. Following the 1 July Frontier Economics report confirming a reduction in scam losses and volumes since the October 2024 reimbursement rules took effect, the PSR has set a stakeholder engagement period over summer 2026, with a formal consultation scheduled for December. The unresolved structural issue — inconsistent protection for consumers on card-not-present, agency banking, and e-money rails versus Faster Payments — will not be addressed until wider PSR-FCA consolidation proceeds through primary legislation in the 2026/27 parliamentary session.
Recommended action
No immediate action required. Flag 16 September 2026 (Fed report deadline) and December 2026 (PSR consultation) as the next two dates on the regulatory calendar worth reviewing for downstream effects on payments infrastructure and fraud liability exposure.
