The role of the Federal Reserve The Federal Reserve will continue to play an important role in fostering a smoothly functioning payments system that is safe, efficient, and accessible. We also need to be flexible in carrying out our traditional payments system functions – provider of payment services, regulator, and catalyst for change – in the rapidly changing payments landscape.
Since its inception, the Federal Reserve’s broad role in the payments system has been to improve efficiency and foster financial stability. When the Federal Reserve was formed almost one hundred years ago, the U.S. banking system was highly fragmented and checks were not cleared at par.