The Independent Community Bankers of America (ICBA) has commended the House of Representatives for passing legislation that would restrict the federal government's ability to introduce a U.S. central bank digital currency (CBDC). The ICBA, representing community banks nationwide, has voiced concerns about the potential negative impacts of a CBDC on their operations and consumer privacy.
"ICBA and the nation’s community banks commend House members for passing legislation to bar the Federal Reserve from issuing a U.S. CBDC to consumers, which would disintermediate community banks, reduce credit availability, and undermine consumer privacy," stated ICBA President and CEO Rebeca Romero Rainey. "The CBDC Anti-Surveillance State Act — which was a key community banker grassroots advocacy issue during the recent ICBA Capital Summit — would avoid the unnecessary risks to consumers and small businesses that a U.S. CBDC would pose, and we encourage Congress to continue advancing this important legislation."
The CBDC Anti-Surveillance State Act (H.R. 5403), introduced by House Majority Whip Tom Emmer (R-Minn.), aims to prevent Federal Reserve Banks from offering products or services directly to individuals, maintaining individual accounts, or issuing a CBDC to individuals. Additionally, it seeks to bar both the Federal Reserve and Treasury Department from issuing a CBDC without congressional authorization.
ICBA has consistently opposed the creation of a U.S. CBDC. Recently, it requested federal records from U.S. agencies regarding whether legislative changes are necessary for issuing such a currency. In communications with Congress, letters to the Fed and White House, and an op-ed in American Banker, ICBA argued that a U.S. CBDC could jeopardize community banks' access to deposits and their ability to lend funds crucial for economic growth while posing risks to the overall health of the U.S. financial system.
ICBA remains committed to opposing the establishment of a U.S. CBDC and supports final passage of the CBDC Anti-Surveillance State Act.
The Independent Community Bankers of America® is dedicated to creating an environment where community banks can thrive through advocacy, education, and innovation. Community banks use their relationship-based business model and innovative offerings to channel deposits into local neighborhoods, fostering job creation, economic prosperity, and supporting customers' financial goals.
For more information about ICBA's mission and activities, visit icba.org.