Ripple Petitions Fed for FedNow Service Changes
Ripple, the issuer of XRP, has formally petitioned the Federal Reserve to change its FedNow service rules. The company is seeking a level playing field for non-bank payment providers to gain direct access to the real-time payments network.
- Under current Federal Reserve rules, only organizations eligible to hold a Master Account, such as depository institutions, can directly access the FedNow service; non-bank payment providers must partner with a participating bank to connect. - Ripple's advocacy for direct non-bank access is part of a broader strategy that includes its application for a National Trust Bank Charter and a Federal Reserve Master Account, which would allow its own stablecoin reserves to be held at the central bank. - Proponents argue that forcing fintechs to rely on traditional banks—often direct competitors—for access to payment rails increases costs and stifles innovation, whereas direct access could lower transaction costs and diversify the range of services. - The debate over direct access is also happening in other markets; as of October 2025, European regulations will permit non-bank payment service providers to become direct participants in key European payment systems like T2 and TIPS. - The U.S. already has a private real-time payments network, The Clearing House's RTP, which launched in 2017 and has a significantly higher transaction volume than the newer, Fed-operated FedNow. - FedNow has reached over 1,300 participating financial institutions, with community banks and credit unions making up more than 95% of the total, indicating broad-based adoption beyond the largest banks. - This petition aligns with a larger trend of institutional adoption of blockchain and stablecoins for payment infrastructure, where firms like Fidelity are launching stablecoins to streamline asset settlement and reduce counterparty risk.
