,,ii #aafth ,,congress #ast ,session ,s4 #bbdc ,,in ,,the ,,senate ,,of ,,the ,,united ,,states ,july #bd1 #bjai,mr4 ,van ,hollen 7for himself and ,ms4 ,warren7 introduced the following bill2 which was read twice and referred to the ,committee on ,banking1 ,housing1 and ,urban ,affairs ,a ,,bill ,to amend the ,expedited ,funds ,availability ,act to require that funds deposited be available for withdrawal in real-time1 and for other purposes4 #a4 ,short title ,this ,act may be cited as the ,payments ,modernization ,act of #bjai 4 #b4 ,findings and purposes 7a7 ,findings ,congress finds the following3 7#a7 ,families in the ,united ,states spend billions of dollars in overdraft fees in part because they are waiting for checks to clear over a weekend or holiday4 7#b7 ,the inefficient payment system in the ,united ,states drives families1 especially those living paycheck to paycheck1 to use high-cost financial services to access funds more rapidly4 7#c7 ,a faster payment system would provide people of the ,united ,states immediate access to funds and relief for those who overdraw their accounts because their deposits are not available in real-time1 helping families potentially save billions of dollars each year4 7#d7 ,the ,united ,states lags behind other countries in the speed and efficiency of its payment system4 7#e7 ,central banks around the world have already implemented real-time payment systems1 including in the ,united ,kingdom1 ,australia1 ,mexico1 ,poland1 ,japan1 and ,south ,africa4 7#f7 ,the ,federal ,reserve ,system was created by ,congress on ,december #bd1 #aiac1 in response to the financial panic of #aijg4 7#g7 ,since its beginning1 the ,federal ,reserve ,system has played a crucial role in the payment system of the ,united ,states4 7#h7 ,the role of the ,federal ,reserve ,system in providing payment services is-- 7,a7 to promote the integrity and efficiency of the payment mechanism2 and 7,b7 to ensure the provision of payment services to all depository institutions on an equitable basis and in an atmosphere of competitive fairness4 7#i7 ,the ,monetary ,control ,act of #aihj 7title ,i of ,public ,law #if-bba2 #id ,stat4 #acb7 provided the ,board of ,governors of the ,federal ,reserve ,system with the authority to oversee the payment system in the ,united ,states4 7#aj7 ,the ,expedited ,funds ,availability ,act 7#ab ,u4,s4,c4 #djja et seq471 enacted on ,august #aj1 #aihg1 provided the ,board of ,governors of the ,federal ,reserve ,system with full authority to regulate all aspects of the payment system1 including the receipt1 payment1 collection1 clearing of checks1 and related functions of the payment system pertaining to checks4 7#aa7 ,in a ,july #bjah report on financial technology1 the ,department of ,treasury acknowledged the important role of the ,board of ,governors of the ,federal ,reserve ,system in bringing real-time payment settlement services to the ,united ,states when the ,department recommended the ,board of ,governors work to facilitate a faster retail payment system1 in particular1 for smaller financial institutions such as community banks and credit unions1 noting that such institutions should also have the ability to access the most innovative technologies and payment services4 7#ab7 ,the authorities described in paragraphs 7#i7 and 7#aj7 are more critical than ever given how the financial services sector has been defined as a vital component of critical infrastructure in the ,united ,states4 7#ac7 ,the role of the ,board of ,governors of the ,federal ,reserve ,system in the financial services sector will ensure the resiliency of the payment system in the ,united ,states4 7#ad7 ,the ,board of ,governors of the ,federal ,reserve ,system should develop a real-time interbank payment system to ensure that-- 7,a7 consumers are prioritized2 7,b7 consumers and small businesses are protected from fraud and errors1 including with respect to a payment initiated by a consumer or small business2 7,c7 the payment system is open to increased competition2 and 7,d7 outsized entities do not monopolize the financial infrastructure of the ,united ,states4 7b7 ,purposes ,the purposes of this ,act are-- 7#a7 to ensure that the ,united ,states has a safe1 fast1 efficient1 equitable1 and fair payment system2 7#b7 to clarify that the ,board of ,governors of the ,federal ,reserve ,system has the existing authority to build a real-time payment system2 and 7#c7 to make certain that the ,board of ,governors of the ,federal ,reserve ,system follows through on implementing the system described in paragraph 7#b74 #c4 ,definition ,in this ,act1 the term real-time has the meaning given the term in section #fjb of the ,expedited ,funds ,availability ,act 7#ab ,u4,s4,c4 #djja71 as amended by section #d7;a7 of this ,act4 #d4 ,requirement that funds deposited be available for withdrawal in real-time 7a7 ,definitions 7#a7 ,in general ,section #fjb of the ,expedited ,funds ,availability ,act 7#ab ,u4,s4,c4 #djja7 is amended-- 7,a7 by redesignating paragraphs 7#bj7 through 7#be7 as paragraphs 7#ba7 through 7#bf71 respectively2 and 7,b7 by inserting after paragraph 7#ai7 the following3 7#bj7 ,real-time ,the term real-time-- 7,a7 means any time2 and 7,b7 includes a ,saturday1 ,sunday1 and a legal holiday4 4 7#b7 ,technical and conforming amendment ,section #c of the ,check ,clearing for the #bast ,century ,act 7#ab ,u4,s4,c4 #ejjb7b77;,d77iv77 is amended by striking section #fjb7bd7 and inserting section #fjb7be74 7b7 ,expedited funds availability schedules ,section #fjc of the ,expedited ,funds ,availability ,act 7#ab ,u4,s4,c4 #djjb7 is amended-- 7#a7 in subsection 7a7-- 7,a7 in the subsection heading1 by striking ,next ,business ,day and inserting ,real-time2 7,b7 in paragraph 7#a7-- 7i7 by striking ,except as provided in subsection 7e7 and in section #fjd1 in and inserting ,in2 and 7ii7 in the matter following subparagraph 7,b7 by striking not later than the business day after the business day on which and inserting in real-time when2 and 7,c7 in paragraph 7#b71 in the matter preceding subparagraph 7,a71 by striking not later than the business day after the business day on which and inserting in real-time after2 and 7#b7 by striking subsection 7b7 and inserting the following3 7b7 ,permanent ,schedule ,funds deposited in an account at a depository institution by a check drawn on a local or nonlocal originating depository institution shall be available for withdrawal in real-time4 2 7#c7 by striking subsection 7c72 7#d7 by striking subsection 7d72 7#e7 by redesignating subsections 7e7 and 7f7 as subsections 7c7 and 7d71 respectively2 7#f7 in subsection 7c71 as redesignated by paragraph 7#e7-- 7,a7 in paragraph 7#a7-- 7i7 in subparagraph 7,a7-- 7,i7 by striking ,not more than #d business days shall intervene between the business day a and inserting ,a2 7,,ii7 by inserting a comma after subparagraph 7,b72 7,,iii7 by striking is2 and 7,,iv7 by striking and the business day on which funds from such deposit are available for withdrawal and inserting shall be available for withdrawal in real-time2 and 7ii7 in subparagraph 7,b71 in the subparagraph heading1 by striking paragraph and inserting subparagraph2 and 7,b7 in paragraph 7#b7-- 7i7 by striking 1 7b71 and 7c7 and inserting and 7b72 and 7ii7 in the paragraph heading1 by striking temporary and permanent schedules and inserting permanent schedule2 and 7#g7 in subsection 7d77#b71 as redesignated by paragraph 7#e71 by striking 7c71 or 7e7 and inserting or 7c74 7c7 ,safeguard exceptions ,section #fjd of the ,expedited ,funds ,availability ,act 7#ab ,u4,s4,c4 #djjc7 is amended-- 7#a7 in subsection 7a7-- 7,a7 in paragraph 7#a7-- 7i7 in the paragraph heading by striking ,next business day and inserting ,real-time2 and 7ii7 in the matter following subparagraph 7,d7 by striking on the business day after the business day on which such cash or funds are deposited or1 in the case of a wire transfer1 on the business day after the business day on which and inserting in real-time after such cash or funds are deposited or1 in the case of a wire transfer1 in real-time after2 7,b7 in paragraph 7#b7-- 7i7 by striking 1 #fjc7;c71 or paragraphs and inserting paragraph2 and 7ii7 by striking #fjc7;e7 and inserting #fjc7;c72 and 7,c7 by striking paragraph 7#c77;,b7 and inserting the following3 7,b7 any such funds deposited in excess of such amount shall be available for withdrawal in real-time4 2 7#b7 in subsection 7b71 in the matter preceding paragraph 7#a71 by striking 7c71 or 7e7 and inserting or 7c72 7#c7 in subsection 7c77#a71 by striking 7c71 and 7e7 and inserting and 7c72 and 7#d7 in subsection 7d71 by striking 7c71 and 7e7 and inserting and 7c74 7d7 ,miscellaneous provisions ,section #fjg of the ,expedited ,funds ,availability ,act 7#ab ,u4,s4,c4 #djjf7 is amended-- 7#a7 by striking subsections 7a7 and 7b72 and 7#b7 by redesignating subsections 7c7 through 7f7 as subsections 7a7 through 7d71 respectively4 7e7 ,regulations and reports by ,board ,section #fji of the ,expedited ,funds ,availability ,act 7#ab ,u4,s4,c4 #djjh7 is amended-- 7#a7 by striking subsections 7d7 and 7f72 and 7#b7 by redesignating subsection 7e7 as subsection 7d74 #e4 ,payments mandate ,the ,federal ,reserve shall create a real-time payment system that-- 7#a7 at a minimum1 conforms with the principles outlined in the final report of the ,faster ,payments ,task ,force of the ,federal ,reserve ,system2 7#b7 allows end users have fast access to funds in real-time2 7#c7 operates as a utility1 allowing end users to reach any other end user1 including unbanked1 underserved and cross-border end users1 regardless of the solution used by the end user2 7#d7 prioritizes safety and soundness1 consumer health1 efficiency1 and other relevant public interest considerations2 7#e7 provides end users with the confidence and trust in the safety and security of the system by ensuring that-- 7,a7 fraud and errors are minimized and resolved quickly2 and 7,b7 the assets1 accounts1 and information of the end user are protected1 even as payments cross different solutions2 7#f7 has transparent operating information2 and 7#g7 ensures that there are no volume discounts made that disadvantage smaller financial institutions4