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The Federal Reserve and retail payments: a historical review

Ashish Lall (National University of Singapore, Singapore, Singapore)

Journal of Financial Regulation and Compliance

ISSN: 1358-1988

Article publication date: 12 February 2018




The purpose of this paper is to provide a comprehensive historical review of the role of the Federal Reserve in retail payments in the USA.


It reviews the literature on the role of the Federal Reserve and assessments of its involvement.


In addition to its oversight and operational role, the Federal Reserve has conducted R&D and facilitated technology adoption. It has provided effective competition to the private sector without subsidies.

Research limitations/implications

The Federal Reserve has served the public interest and private networks have benefited from the “visible hand” of government.

Practical implications

Migration to electronic payments will likely change its role from an operator to setting standards for safety and security.


The historical review provides context against which the future strategy of the Federal Reserve may be assessed.



The author thanks the Lee Kuan Yew School of Public Policy, National University of Singapore for a research grant and Dr Lawrence Schembri and two anonymous reviewers for helpful comments and suggestions.


Lall, A. (2018), "The Federal Reserve and retail payments: a historical review", Journal of Financial Regulation and Compliance, Vol. 26 No. 1, pp. 58-71.



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