PACE Act of 2026
- Bill Number
- H.R. 8395
- Origin Chamber
- House
- Congress
- 119th Congress, Session 2
- Policy Area
- Finance and Financial Sector
- Status
- Introduced
- Latest Action
- 2026-04-21: Referred to the House Committee on Financial Services.
- Last Updated
- 2026-06-25T08:08:50Z
AI-Generated Summary
Purpose
The Payments Access and Consumer Efficiency Act of 2026 (PACE Act) establishes a federal registration system overseen by the Comptroller of the Currency for certain state-licensed providers of payment services (e.g., money transmission, stored value). It aims to promote innovation, competition, and consumer access to efficient payment systems while ensuring safety through reserves, risk management, and supervision.
Key Provisions
- Definitions:
- Covered provider: Entities offering "payment services" (e.g., transmitting money, issuing stored value or payment instruments like checks/cards) that hold ≥40 state money transmitter licenses, or state charters as depositories/credit unions.
- Registered covered provider: Approved applicants under the Act.
- Other terms include "payments reserve account" (Fed access for wires, real-time payments, ACH) and "outstanding payment obligations" (unpaid transmission amounts).
- Federal Registration (Sec. 3):
- Comptroller approves based on limited activities (payments only), financial/managerial fitness, Bank Secrecy Act compliance, public benefit (innovation/access), and more.
- Multi-state license holders can operate nationwide post-registration.
- 180-day decision timeline (deemed approved if missed); denial/revocation only for specified reasons.
- Customer Protections (Sec. 4):
- 1:1 reserves in highly liquid assets (e.g., cash, Fed deposits, short-term Treasuries, certain repos/money market funds; tokenized forms allowed).
- No pledging/rehypothecation of reserves (reuse banned except limited cases).
- Segregate custody assets; detailed recordkeeping for obligations/reserves.
- Risk Management and Fair Access (Sec. 5):
- Tailored capital/liquidity/risk rules (mirroring GENIUS Act for stablecoins).
- Fair access: No denial/cancellation based on protected beliefs/politics; decisions must be risk-based (applies Equal Credit Opportunity Act).
- Supervision and Enforcement (Secs. 6-7):
- Comptroller examinations for safety, risks, consumer compliance.
- Critical third-party service providers supervised; prompt contract notifications.
- Enforcement powers like those for banks; periodic reports (using existing data where possible).
- Insolvency Resolution for Nonbanks (Sec. 8):
- Excludes from federal bankruptcy; state-led proceedings preferred, with Comptroller as backup conservator/receiver.
- Customer claims prioritized over general liabilities/shareholders.
- Segregated custody assets protected.
- Fed Access (Sec. 9):
- Registered providers get "payments reserve accounts" like banks (120-day approval).
- Fed enforcement in crises (with notice/review rights).
- Securities Law Exemptions (Sec. 10):
- Balances with registered providers excluded from "security" definitions under key securities laws (Investment Advisers/Company Acts, Securities Act/Exchange Act, SIPA).
Significant Changes to Existing Law
- Creates federal "passporting" for state-licensed payment providers, bypassing per-state approvals.
- Introduces bank-like Fed master account access and tailored reserves/risk rules for nonbanks.
- Special non-bankruptcy resolution with customer priority (unlike general bankruptcy).
- Amends securities laws to treat provider balances as non-securities, reducing regulatory burden.
Potential Impacts
- Government Agencies: Expands Comptroller's role in supervising nonbanks/third parties; Fed manages new accounts/enforcement; states retain licensing but share resolution.
- Citizens/Consumers: Enhanced protections (reserves, priority in failure), fair access to payments, potential for cheaper/faster services via competition/innovation.
- Payment Providers: Nationwide operations, Fed access ease scaling but add compliance costs/exams.
- Banks: Increased competition from regulated nonbanks.
- No direct international relations impact noted.
Main Stakeholders
- Registered covered providers (e.g., large money transmitters, fintechs).
- Customers of payment services.
- Regulators: Comptroller of the Currency (primary), Federal Reserve Board, state agencies (licensing/resolution), FDIC/NCUA (reserve limits).
- Insured banks/credit unions (competitors, counterparties).
Notable Legal, Constitutional, or Political Implications
- Legal: Federal preemption of state barriers for approved providers; bridges state/federal oversight without full chartering.
- Constitutional: Fair access rules prohibit viewpoint discrimination, potentially raising First Amendment questions if challenged as compelled speech.
- Political: Balances innovation (public benefit test) with safety; promotes nonbank competition in payments amid fintech growth, but ties to GENIUS Act suggest stablecoin/payment ecosystem integration.
This summary was generated by AI and may contain inaccuracies. Refer to the official source document for the authoritative text.
Sponsor
Cosponsors (2)
Rep. Liccardo, Sam T. [D-CA-16], Rep. Sessions, Pete [R-TX-17]
Recent Actions
- 2026-04-21: Referred to the House Committee on Financial Services.
- 2026-04-21: Introduced in House
- 2026-04-21: Introduced in House
Bill Versions
- Payments Access and Consumer Efficiency Act of 2026 — issued 2026-04-21 — PDF (23 pages)