This is all about a nebulous future virtual banking wallet that will be 10+ years away. How about Congress get back to their job and allow, for example, the USPS to offer simple, basic, current banking services to everyone at every location? Tie it into the Fed's upcoming instant transfer/payments service. This would do more for access and giving underserved/overcharged people a way to enter the economy than whatever cyber hype this is about.
Allowing the USPS to provide pass through FedAccounts makes it easier for the USPS to provide the service.
Digital dollars is just a deposit account held at the Fed. Instant payments are coming for everyone in 2023-2024; the heavy lifting is enacting legislation to reduce the burden of providing accounts to everyone. You have to turn banking in the US into a utility like Europe did, and drive down it's parasitic drag.
There's a standard playbook incumbents in every industry use to prevent, delay, and castrate any threats to their moats. While I'll always take advantage of any publicity to nudge the Overton window, real change, for the silent majorities, is stalled out due to a long list of systemic issues across all governmental bodies.
There’s an interesting discussion on why giving every citizen a federal account makes sense on the latest episode of deconstructed.
“ Basically, the Fed functions at the moment as a sort of bank for the banks. And then the hope is that all Americans have their own banks. And so there’s a kind of one-step removal between us and the Fed. What we’re advocating here is cutting out that middleman to the private sector banking institution. And in a sense what the Fed would do is offer digital wallets to all small businesses and citizens and approved residents of the United States in the way that it currently does for banks, right?
I mean, what it offers to the banks right now are Fed accounts. Right? Accounts with the Fed, they’re called reserve accounts. And what we’re saying is that the reserve accounts that are only for banks should be replaced by digital wallets for all citizens, small businesses, and again, legal writ.”
Forgive me if this is explained in the article you linked or the bill itself, I don't have the time to read either in their entirety at the moment.
Someone will need to teach millions of of Americans how to use this newfangled technology. I can't in good faith expect volunteers, friends and family to do this for everyone professionally, orderly, and accurately.
So, if the fed gets into consumer and smb banking are they going to outsource customer service or what? Maybe I'm misunderstanding the premise of this bill but it seems like an aca level headache that Republicans will propagandize against, obstruct, and sabotage at every opportunity; if the aca is anything to go by.
What's concerning is that in order to offer FedAccounts, the particular postal office has to partner with a bank. Does this mean if you go to a post office in another area you won't be able to access your account? With the prevalence of online banking, do the already busy USPS offices really need to be a retail location for a bank?
Why can't the USPS just offer these services themselves? Especially since the bill reimburses member banks for operating costs related to FedAccounts. Might as well cut out the middleman.
This remotely reminds me of European PSD2 - it was also meant to turn banks into utilities, but in the end even web-scraping the online banking was recognised as "providing an API", thus seriously limiting its real world use.
Otherwise this digital dollar is nothing more than a cheap marketing trick to counter the rise of crypto.
> Otherwise this digital dollar is nothing more than a cheap marketing trick to counter the rise of crypto.
Even if banks continue to exist as they are, there is one meaty impact that a purely digital dollar would create: it would allow the Fed to implement negative interest rates without creating a flight to cash[0]. I'm not sure if that's good or bad thing, but it seems more impactful than branding a bank account "Americoins".
Ah yes, PSD2, the Open Banking initiative that makes it virtually impossible for a regular person to access their own data. Only certified companies can.
I haven't been to a physical bank to do any business in close to a decade. This looks like a USPS bailout package for what's largely another useless service other than doing package delivery. The "unbanked" can sign up for something like Ally.
