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Congress·In Committee·S. 2113

Congress targets Fed payments to banks by banning interest on reserve balances

End the Fed’s Big Bank Bailout Act

3 months ago·View on Congress.gov
⏸

Stalled

No legislative action in over 90 days.

Legislative Progress

Senate
House
President
Law

Key Points

  • This bill would stop Federal Reserve banks from paying earnings (interest) on money banks keep parked at the Fed.
  • Supporters argue this would reduce what they see as a subsidy to big banks and could push banks to use more money for loans instead of holding it at the Fed.
  • Banks could earn less from simply holding balances at the Fed, which may change how they manage cash and could affect some bank profits.
  • The change could ripple into how short-term interest rates are managed, since paying interest on these balances is one tool the Fed uses to steer rates.
EconomyTrade

Impact Analysis

Personal Impact

How this policy affects specific groups of people

Mixed Impacts(2)
Small Business Owner
Neutral
Retiree
Neutral

Milestones

2 milestones3 actions
Dec 11, 2025Senate

Committee on Homeland Security and Governmental Affairs. Hearings held.

Jun 18, 2025Senate

Read twice and referred to the Committee on Banking, Housing, and Urban Affairs.

Jun 18, 2025

Introduced in Senate

What Happens Next

Projected impacts based on AI analysis

As soon as the law takes effect after enactment

Federal Reserve stops paying interest on balances held by or for banks and credit unions (if the bill becomes law).

Banks and credit unions would no longer receive this low-risk payment from the Fed, and may adjust lending, savings rates, or fees in response.

Source Information

Document Type

Congressional Bill

Official Title

End the Fed’s Big Bank Bailout Act

Bill NumberS 2113
Congress119th Congress
ChamberSenate
Latest ActionCommittee on Homeland Security and Governmental Affairs. Hearings held.

Sponsor

Cosponsors

(1)
I: 1

Analysis generated by AI. Always verify with official sources.