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Illustration: Rebecca Zisser/Axios

The Fed is developing its own real-time payments and settlement service and reviewing 200 comment letters submitted late last year about the proposal, Fed governor Lael Brainard said in a speech Wednesday.

What's happening: Central banks around the world have been working to issue digital currencies amid a decline in the use of cash and an increase in dependence on commercial banks for payments. Private companies like Facebook and its Libra cryptocurrency also have spurred central banks into action.

Why it matters: "Today, it can take a few days to get access to your funds," Brainard said in her speech. "A real-time retail payments infrastructure would ensure the funds are available immediately — to pay utility bills or split the rent with roommates, or for small business owners to pay their suppliers."

  • "Immediate access to funds could be especially important for households on fixed incomes or living paycheck to paycheck when waiting days for the funds to be available to pay a bill can mean overdraft fees or late fees that can compound."
  • "To make this possible, it is vital to invest in real-time retail payments infrastructure with national reach."

The big picture: The private sector already is amassing holdings of the public's money that is larger than many banks, she said, highlighting Paypal, Walmart and Starbucks as companies that currently hold billions of dollars of their customers' money on various cards and accounts.

The last word: "Although various federal and state laws establish protections for users, issuers of nonbank money are not regulated to the same extent as banks, the value stored in these systems is not insured directly by the FDIC, and consumers may be at risk that the issuer will not be able to honor its liabilities."

Go deeper:

Go deeper

Mike Allen, author of AM
19 mins ago - Politics & Policy

Biden's inauguration signals a great American reset

President Biden prepares to walk the abbreviated parade route in front of the White House after the inauguration. Photo: Mark Makela/Getty Images

President Biden had exited his Cadillac with the new "46" license plates and was strolling a short stretch of Pennsylvania Avenue toward his new home when he spotted "Today" show weather legend Al Roker.

The big picture: Biden dropped Jill Biden's hand — no warning — and trotted over to the delighted Roker. POTUS gave Roker a fist bump and said, "Gotta keep doing this!" It was a very Joe moment in a day that was designed to signal a return to normality in a turbulent America.

Chuck Schumer is now majority leader as 3 new Democratic senators are sworn in

Sen. Chuck Schumer (D-N.Y.) is officially Senate majority leader after the inauguration of Vice President Kamala Harris and the swearing-in of new Sens. Alex Padilla (D-Calif.), Jon Ossoff (D-Ga.) and Raphael Warnock (D-Ga.).

Why it matters: With a 50-50 Senate, Schumer will control a narrow majority with Harris as the tie-breaking vote. Democratic control of the Senate is crucial to President Biden's agenda, from getting his coronavirus relief proposal passed to forgiving student debt.

1 hour ago - Technology

QAnon faces the music

Illustration: Eniola Odetunde/Axios

Supporters of former President Donald Trump who thought he was about to stop the inauguration, seize power and crush his enemies were left blinking in the sunlight Wednesday as President Biden took the oath of office.

Why it matters: It's an inflection point for anyone who realizes they've been strung along by QAnon and related strands of pro-Trump magical thinking. They could either retreat from conspiracy theories or tumble deeper down the rabbit hole.