S7 Ep6: Bank Nerd Corner: Unpacking Federal Reserve Master Accounts with Julie Hill

Alex Johnson
Alex Johnson
May 15, 2024

We have a lot of questions when it comes to Fed Master Accounts. And thankfully, Julie Hill, Vice Dean and Alton C. and Cecile Cunningham Craig Professor of Law at the University of Alabama, is here to answer them! 

In this special edition of Bank Nerd Corner, Julie helps Alex and Kiah unravel the many legal mysteries of the Federal Reserve’s Master Accounts. Julie breaks down the history of the Fed’s payment systems and explains how access to those systems (via Master Accounts) impacts banks and fintech companies.

How do these “bank accounts for banks” work? Which banks can get them? And what happens if access to them is taken away?

Kiah, Alex, and Julie discuss the role of the Fed as a payments facilitator, as opposed to a regulator, and unpack why it’s nearly impossible to make money in payments without having a Master Account.

And later, they dive into the troubling report of sexual harassment at the FDIC, and spend a few minutes marveling at (and ranting about) where bank routing numbers come from. 


00:01:56 – Understanding Federal Reserve Master Accounts

00:14:19 – Credit Union Applies to Serve Cannabis Industry

00:17:22 – Federal Reserve and American Samoa’s Money Laundering Dilemma

00:27:57 – Federal Reserve’s Transparency on Master Accounts

00:35:07 – Federal Reserve Announces New Supervision Team

00:45:01 – Federal Reserve’s Role in Money Laundering

00:51:31 – FDIC Sexual Harassment Review Findings

00:59:46 – Collaborative Structures Improve Aviation Safety

01:02:55 – American Banking Association Still Provides Routing Numbers


TruStage Payment Guard Insurance is a first-of-its-kind insurance solution built for digital lenders, designed to help you attract more borrowers, strengthen your loan portfolio and reduce time spent on collections — all with minimal tech lift needed to go live.


To learn more about Payment Guard Insurance, visit https://www.trustage.com/payment-guard.


Sign up for Alex’s Fintech Takes newsletter for the latest insightful analysis on fintech trends, along with a heaping pile of pop culture references and copious footnotes. Every Monday and Thursday: https://workweek.com/brand/fintech-takes/


And for more exclusive insider content, don’t forget to check out my YouTube page.


Follow Julie: 

LinkedIn: https://www.linkedin.com/in/julie-hill-15929821/

Twitter: https://twitter.com/ProfJulieHill


Follow Kiah:

LinkedIn: https://www.linkedin.com/in/khaslett/

Twitter: https://twitter.com/khaslett


Follow Alex: 

YouTube: https://www.youtube.com/channel/UCJgfH47QEwbQmkQlz1V9rQA/videos

LinkedIn: https://www.linkedin.com/in/alexhjohnson

Twitter: https://www.twitter.com/AlexH_Johnson

Alex Johnson
Alex Johnson