Payments Modernization Act of 2019

I 116TH CONGRESS 1ST SESSION H. R. 3951 To amend the Expedited Funds Availability Act to require that funds depos- ited be available for withdrawal in real time and to require the Board of Governors of the Federal Reserve System to create a real time pay- ment system, and for other purposes. IN THE HOUSE OF REPRESENTATIVES JULY 24, 2019 Ms. PRESSLEY (for herself and Mr. GARCI´A of Illinois) introduced the following bill; which was referred to the Committee on Financial Services A BILL To amend the Expedited Funds Availability Act to require that funds deposited be available for withdrawal in real time and to require the Board of Governors of the Fed- eral Reserve System to create a real time payment sys- tem, and for other purposes. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE. 3 This Act may be cited as the ‘‘Payments Moderniza- 4 tion Act of 2019’’. 5 VerDate Sep 11 2014 04:20 Aug 07, 2019 Jkt 089200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H3951.IH H3951 kjohnson on DSK79L0C42 with BILLS 2 •HR 3951 IH SEC. 2. REQUIREMENT THAT FUNDS DEPOSITED BE AVAIL- 1 ABLE FOR WITHDRAWAL IN REAL TIME. 2 (a) EXPEDITED FUNDS AVAILABILITY SCHED- 3 ULES.—Section 603 of the Expedited Funds Availability 4 Act (12 U.S.C. 4002) is amended— 5 (1) in subsection (a)— 6 (A) in paragraph (1)— 7 (i) by striking ‘‘Except as provided in 8 subsection (e) and in section 604, in’’ and 9 inserting ‘‘In’’; and 10 (ii) in the matter following subpara- 11 graph (B) by striking ‘‘not later than the 12 business day after the business day on 13 which’’ and inserting ‘‘in real time when’’; 14 (B) in paragraph (2) by striking ‘‘not later 15 than the business day after the business day on 16 which’’ and inserting ‘‘in real time after’’; and 17 (C) in the subsection heading by striking 18 ‘‘NEXT BUSINESS DAY’’ and inserting ‘‘REAL 19 TIME’’; 20 (2) by striking subsection (b) and inserting the 21 following: 22 ‘‘(b) PERMANENT SCHEDULE.—Funds deposited in 23 an account at a depository institution by a check drawn 24 on a local or nonlocal originating depository institution 25 shall be available for withdrawal in real time.’’; 26 VerDate Sep 11 2014 04:20 Aug 07, 2019 Jkt 089200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H3951.IH H3951 kjohnson on DSK79L0C42 with BILLS 3 •HR 3951 IH (3) by striking subsection (c); 1 (4) by striking subsection (d); 2 (5) by redesignating subsections (e) and (f) as 3 subsections (c) and (d), respectively; 4 (6) in subsection (c), as redesignated by para- 5 graph (5)— 6 (A) in paragraph (1)(A)— 7 (i) by striking ‘‘Not more than 4 busi- 8 ness days shall intervene between the busi- 9 ness day a’’ and inserting ‘‘A’’; 10 (ii) by inserting a comma after ‘‘sub- 11 paragraph (B)’’; 12 (iii) by striking ‘‘is’’; and 13 (iv) by striking ‘‘and the business day 14 on which funds from such deposit are 15 available for withdrawal’’ and inserting 16 ‘‘shall be available for withdrawal in real 17 time’’; and 18 (B) in paragraph (2)— 19 (i) by striking ‘‘, (b), and (c)’’ and in- 20 serting ‘‘and (b)’’; and 21 (ii) in the paragraph heading by strik- 22 ing ‘‘TEMPORARY AND PERMANENT 23 SCHEDULES’’ and inserting ‘‘PERMANENT 24 SCHEDULE’’; and 25 VerDate Sep 11 2014 04:20 Aug 07, 2019 Jkt 089200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H3951.IH H3951 kjohnson on DSK79L0C42 with BILLS 4 •HR 3951 IH (7) in subsection (d), as redesignated by para- 1 graph (5), by striking ‘‘(c), or (e)’’ and inserting ‘‘or 2 (c)’’. 3 (b) SAFEGUARD EXCEPTIONS.—Section 604 of the 4 Expedited Funds Availability Act (12 U.S.C. 4003) is 5 amended— 6 (1) in subsection (a)— 7 (A) in paragraph (1)— 8 (i) in the matter following subpara- 9 graph (D) by striking ‘‘on the business day 10 after the business day on which such cash 11 or funds are deposited or, in the case of a 12 wire transfer, on the business day after the 13 business day on which’’ and inserting ‘‘in 14 real time after such cash or funds are de- 15 posited or, in the case of a wire transfer, 16 in real time after’’; and 17 (ii) in the paragraph heading by strik- 18 ing ‘‘NEXT BUSINESS DAY’’ and inserting 19 ‘‘REAL TIME’’; 20 (B) in paragraph (2)— 21 (i) by striking ‘‘, 603(c),’’; and 22 (ii) by striking ‘‘603(e)’’ and inserting 23 ‘‘603(c)’’; and 24 VerDate Sep 11 2014 04:20 Aug 07, 2019 Jkt 089200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H3951.IH H3951 kjohnson on DSK79L0C42 with BILLS 5 •HR 3951 IH (C) by striking paragraph (3)(B) and in- 1 serting the following: 2 ‘‘(B) any such funds deposited in excess of 3 such amount shall be available for withdrawal 4 in real time.’’; 5 (2) in subsection (b) by striking ‘‘(c), or (e)’’ 6 and inserting ‘‘or (c)’’; 7 (3) in subsection (c)(1) by striking ‘‘(c), and 8 (e)’’ and inserting ‘‘and (c)’’; and 9 (4) in subsection (d) by striking ‘‘(c), and (e)’’ 10 and inserting ‘‘and (c)’’. 11 (c) MISCELLANEOUS PROVISIONS.—Section 607 of 12 the Expedited Funds Availability Act (12 U.S.C. 4006) 13 is amended— 14 (1) by striking subsections (a) and (b); and 15 (2) by redesignating subsections (c) through (f) 16 as subsections (a) through (d), respectively. 17 (d) REGULATIONS AND REPORTS BY BOARD.—Sec- 18 tion 609 of the Expedited Funds Availability Act (12 19 U.S.C. 4008) is amended— 20 (1) by striking subsections (d) and (f); and 21 (2) by redesignating subsection (e) as sub- 22 section (d). 23 VerDate Sep 11 2014 04:20 Aug 07, 2019 Jkt 089200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H3951.IH H3951 kjohnson on DSK79L0C42 with BILLS 6 •HR 3951 IH SEC. 3. REAL TIME PAYMENT SYSTEM. 1 (a) IN GENERAL.—The Board of Governors of the 2 Federal Reserve System shall create a real time payment 3 system that— 4 (1) at a minimum, conforms with the principles 5 outlined in the final report of the Faster Payments 6 Task Force of the Federal Reserve System; 7 (2) allows end users have fast access to funds, 8 in speeds approaching real time; 9 (3) operates as a utility, allowing end users to 10 reach any other end user, including unbanked, un- 11 derserved, and cross-border end users, regardless of 12 the solution used by the end user; 13 (4) prioritizes safety and soundness, consumer 14 health, efficiency, and other relevant public interest 15 considerations; 16 (5) provides end users with the confidence and 17 trust in the safety and security of the system by en- 18 suring that— 19 (A) fraud and errors are minimized and re- 20 solved quickly; and 21 (B) the assets, accounts, and information 22 of the end user are protected, even as payments 23 cross different solutions; 24 (6) has transparent operating information; and 25 VerDate Sep 11 2014 04:20 Aug 07, 2019 Jkt 089200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\H3951.IH H3951 kjohnson on DSK79L0C42 with BILLS 7 •HR 3951 IH (7) ensures that there are no volume discounts 1 made that disadvantage smaller financial institu- 2 tions. 3 (b) REAL TIME PAYMENT SYSTEM DEFINED.—In 4 this section, the term ‘‘real time payment system’’ means 5 a payment-by-payment interbank settlement system that 6 facilitates settlements in real time and at any time, on 7 any day, including weekends and holidays. 8 Æ VerDate Sep 11 2014 04:20 Aug 07, 2019 Jkt 089200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6301 E:\BILLS\H3951.IH H3951 kjohnson on DSK79L0C42 with BILLS