As previously covered by InfoBytes, Fed Governor Christopher Waller spoke in October about the Fed’s ongoing exploration of a “skinny” master account concept, which would provide basic payment services to payments-focused institutions, while including risk mitigants to ensure stability.

On November 6, Waller clarified his remarks, suggesting at an annual banking conference that skinny master accounts did not apply to fintechs. He noted that such accounts would be confined to eligible, chartered depository institutions. Waller explained the proposal as a way to expand banks’ access to master accounts, which are often restricted to “Tier 1 bank[s],” in a manner that tailors the terms and functionality of the master account to the risks of the institution, as opposed to only providing a single type of master account to the largest banks.