A group of U.S. senators, led by Sen. Sherrod Brown (D-OH), are urging the Federal Reserve to finalize a proposed rule expanding the Fed’s settlement services’ operating hours to weekends and holidays.
The Fed’s settlement services, which include Fedwire Funds Service and National Settlement Service, allow for the transfer of electronic funds through Automated Clearing House (ACH) payments. However, these transfers typically take several days to clear and become available to consumers and small businesses.
Expanding the operating hours of settlement services would help small businesses maintain cash on hand to pay their workers, settle debts, and have a financial buffer in case of an emergency. It would also lower costs for individuals that are vulnerable to overdraft and non-sufficient funds fees and take additional steps to expand settlement services so Americans can access their money 24 hours a day, seven days a week, 365 days a year.
“Given its ubiquity, it is no surprise that consumer and industry groups support expanding settlement services to weekends and holidays. Expanding settlement services to weekends will benefit the millions of people who use ACH to ‘pay their mortgages, rent, student loans, credit cards and many other payments,’” the senators wrote in a letter to Fed Chair Jerome Powell. “Faster payments help Americans gain access to their money, reducing the likelihood that they will overdraw their accounts or pay an NSF fee.”
In addition to Brown, the letter was signed by Sens. Chris Van Hollen (D-MD), Elizabeth Warren (D-MA), Tina Smith (D-MN), and John Fetterman (D-PA).
“Finalizing this rule and expanding Fedwire and NSS services to include weekends and holidays, will strengthen our payment system and ensure that Americans using the ACH network gain swifter access to their funds,” the letter concluded.