Fed turns user friendly in payment risk campaign
This month, the Federal Reserve Board is supposed to present its latest scheme for eliminating risk from the payments system. All signs point to an effort to nudge along the process without alienating bank or corporate constituents, setting for a modest step on what may be a long journey.
It's doubtful that the central bank's current approach to its controversial daylight overdraft pricing scheme will pack the same wallop it did when it was unveiled last year.
Fed officials working on the risk reduction program concede that the Board will not take up final recommendations on how daylight overdrafts are to be measured - considered the most controversial of the pending proposals.
"Most likely, we'll be going out for comment again on when to post transactions for purposes of measuring and pricing daylight overdrafts," explains Florence Young, assistant director within the Fed's Reserve Bank Operations Division.
The Fed's daylight overdraft proposals originally called for all non-wire transactions - namely, checks and automated clearing house items - to be posted to the accounts of financial institutions at the close of FedWire …