The Daily Fuckup

Trump signed an executive order on May 19 directing federal financial regulators to review regulations, guidance, supervisory practices and application processes that could be limiting fintech firms and other new entrants. The order also asks the Federal Reserve to examine the legal, regulatory and policy framework for Reserve Bank payment accounts and payment services, including access for uninsured depository institutions and nonbank financial companies. The White House says the point is to broaden room for financial innovation while keeping the system within existing law and safety-and-soundness constraints. ([whitehouse.gov](https://www.whitehouse.gov/presidential-actions/2026/05/integrating-financial-technology-innovation-into-regulatory-frameworks/))

The order itself does not change who is legally entitled to a Fed account or payment service. Instead, it asks for a review of legal authority, possible options for wider access, and the barriers that could stand in the way. It also says any implementation has to remain consistent with applicable law. ([whitehouse.gov](https://www.whitehouse.gov/presidential-actions/2026/05/integrating-financial-technology-innovation-into-regulatory-frameworks/))

A day later, the Federal Reserve proposed a payment account for legally eligible institutions that need direct access for clearing and settling payments. The Fed said the proposal is closely aligned with an earlier December 2025 request for information, and that it would not expand or change legal eligibility for access to Federal Reserve accounts or payment services. The proposal would also keep payment account holders off intraday credit, the discount window and interest on balances at a Reserve Bank, while limiting the account to payment services with controls meant to prevent overdrafts. ([federalreserve.gov](https://www.federalreserve.gov/newsevents/pressreleases/other20260520a.htm))

The Fed also said it is encouraging Reserve Banks to temporarily pause decisions on access requests from institutions in Tier 3 of its Account Access Guidelines until it finishes work on the payment-account proposal. The central bank said that pause is meant to give it time to gather public input and promote consistent implementation. ([federalreserve.gov](https://www.federalreserve.gov/newsevents/pressreleases/other20260520a.htm))

The clash is over more than paperwork. Reserve Bank payment access can shape how fast payments settle and how much friction nonbank firms face when they try to plug directly into the financial system. Trump’s order pushes regulators to revisit the rules and the Fed’s proposal sketches a constrained path that keeps the legal gate in place while testing whether some firms should get a limited lane onto the payment rails. ([whitehouse.gov](https://www.whitehouse.gov/presidential-actions/2026/05/integrating-financial-technology-innovation-into-regulatory-frameworks/))