U.S. Reps. Young Kim (R-CA) and Sam Liccardo (D-CA) introduced legislation recently that would modernize how payment companies access payment rails.
The legislation, the Payments Access and Consumer Efficiency (PACE) Act, would help Americans send and receive money faster and with fewer fees, the law makers said. Currently, when Americans use a payment app to send or receive money, the transaction passes through multiple layers before reaching its destination. The process slows down payments and adds extra costs along the way. The PACE Act, Kim and Liccardo said, would enable qualified providers to directly access federal payment systems which would reduce delays and lower costs for consumers and small businesses.
“Whether it’s splitting a bill, paying rent, or waiting on a paycheck to clear, Americans are often stuck dealing with delays and increased fees due to outdated payment infrastructure,” Kim said. “Hardworking Americans shouldn’t have to wait days to access their own money or pay extra just to move it.”
The legislation would streamline the federal registration process for qualified payment companies, and would increase consumer protections. Additionally, the legislation would give approved companies direct access to federal payment systems and improve federal oversight and enforcement of payment companies.
“We can reduce the burden of bank fees borne by too many American families by enabling broader access to innovative payment systems that deliver cheaper, faster, more reliable service,” Liccardo said.
The legislation has been endorsed by Financial Technology Association, Blockchain Association, The Digital Chamber, and The Crypto Council For Innovation.
“American consumers and small businesses shouldn’t have to wait days for a direct deposit to clear or a vendor check to arrive in the mail. Allowing regulated payment firms access to federal payment rails will enable faster transactions, lower costs, and more seamless experiences on par with other leading economies. We thank Congresswoman Kim and Congressman Liccardo for their leadership on this important effort to upgrade our national payments infrastructure,” Penny Lee, President and CEO of the Financial Technology Association, said.