The Federal Reserve recently asked the public a question that sits at the heart of what we work on every day at the Interledger Foundation: who should have access to the core infrastructure of money movement in the United States, and on what terms?

In February 2026, the Interledger Foundation submitted a formal response to the Federal Reserve’s request for information on a proposed “special purpose Payment Account”, which would be a new type of account that would give certain non-banks like fintechs direct access to Federal Reserve settlement services. Here is what we said, and what we hope comes of it.

What the Federal Reserve Is Proposing

The Federal Reserve is exploring a new, narrowly scoped account type for institutions that primarily move money, but that do not need, want, or potentially qualify for a full banking charter. That describes many of the emerging fintechs and digital wallet providers in the Interledger ecosystem.

The Federal Reserve is proposing to offer eligible institutions something very valuable: direct, reliable settlement access through core Federal Reserve payment infrastructure, including FedNow.

Why We Got Involved

We want to be clear about what we are and what we are not. The Interledger Foundation is a nonprofit grantmaking organization. We do not provide consumer financial services. We are not seeking a Payment Account for ourselves, and we have no commercial interest in the outcome of this rulemaking.

What we do have is a front-row view of the practical barriers that prevent smaller, mission-driven payment providers from serving low-income households well. Our grantees and ecosystem partners operate in 42 countries, and many of them are building products specifically for people who have been underserved or excluded by mainstream financial institutions. When those providers struggle to access reliable settlement infrastructure, the people paying the real price are their customers: workers waiting an extra day for wages, families hit with overdraft fees because a benefit payment arrived late, communities priced out of the financial system entirely.

We think that public comment processes like this one are a meaningful opportunity to make sure that the lived experience of financial exclusion is part of the policy conversation.

What We Said

Our comments focused on three broad themes:

Settlement access is an inclusion issue.

For many smaller, payments-focused providers, the current pathway to settlement infrastructure runs through a licensed bank acting as an intermediary. That arrangement adds cost, complexity, and constraints that shape (and often limit) what products can be offered and to whom. A more direct and proportionate pathway to settlement access could reduce those frictions and make it easier for providers to deliver faster, cheaper, more reliable payments to the people who need them most. We argued that the Payment Account prototype, if well designed, could be a meaningful step in that direction.

“Streamlined” should mean faster and more transparent, not less rigorous.

Easier access to settlement infrastructure also means higher stakes if something goes wrong. We pushed back on any interpretation of this proposal that would treat simplified eligibility as an invitation to lower standards for operational resilience, cybersecurity, or anti-money-laundering compliance. The communities most harmed by financial fraud and system failures are often the same communities this proposal is meant to serve. Protecting consumers requires clear, enforceable, and proportionate expectations.

The no-interest design should be accompanied by fee relief.

Holding funds in a non-interest-bearing account is a real cost, particularly for providers operating on thin margins serving low-balance customers. We suggested that if the Federal Reserve maintains a no-interest structure, Payment Account holders should benefit from zero transaction fees for the Federal Reserve payment services that they access through the account. And that benefit should be passed through to end-users. The public policy rationale for a constrained account weakens considerably if its practical effect is to make inclusive payment products less viable.

What Success Looks Like

We offered the Federal Reserve a way to think about measuring whether the Payment Account actually achieves its goals, in terms of outcomes for people.

Are fees for common payment use cases going down? Are more transactions completing same-day or instantly? Are failure rates, which disproportionately harm low-balance households, declining? Are applications being processed in a reasonable and predictable timeframe? Is the compliance framework enabling responsible market entry rather than inadvertently pushing vulnerable communities further outside the regulated financial system?

These are the questions we would want answered a few years from now. These are also the questions the providers we support in the Interledger ecosystem are asking today as they decide whether to build for the people most often left behind.

The Bigger Picture

Payment infrastructure might not be the most visible policy frontier, but it is one of the most consequential. The rails on which money moves shape who can participate in the economy, on what terms, and at what cost. As those rails become faster and more digital, the gap between those with reliable access and those without risks widening.

We consider the Federal Reserve’s exploration of the Payment Account prototype to be a serious and welcomed attempt to ask whether the current model of settlement access is the right one for a rapidly changing payments landscape. We think the answer is worth working through carefully, with attention to both system integrity and the communities whose financial stability depends on getting it right.

Our full comment letter is available on the Federal Reserve’s public docket (OP-1877).