Fed's 2025 Pricing, the Digital Euro Challenge, and More
The Global Treasurer
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Weekly digest | By Rachael Kennedy
Welcome to The Global Treasurer's latest Digest, your go-to source for the week's top insights and updates tailored for treasury professionals. What are the most popular articles from this week? We've put together a list, so you never miss out. In this issue, you'll find:
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TOP READS
NEWS
As Bitcoin soars to $100,000, European banks face a costly challenge with the mandatory implementation of the European Central Bank's (ECB) digital euro. Set to launch by 2030, this intermediated central bank digital currency (CBDC) will require banks to overhaul infrastructure, including ATMs, branches, and mobile apps, to support its use. Unlike existing digital payments, the digital euro is a direct liability of the ECB, introducing new complexities for both banks and consumers. The transition could cost billions, with discussions ongoing about leveraging SEPA instant payment rails to minimize expenses. The ECB aims to balance privacy and regulatory compliance, ensuring it cannot monitor individual transactions, while maintaining strict caps on digital euro holdings to protect liquidity. Despite industry concerns about redundancy with existing payment systems, the digital euro marks a pivotal step in Europe's journey toward payment sovereignty. Banks are now navigating the dual challenges of implementation costs and explaining the coexistence of cash, commercial bank deposits, and digital euros to customers. Read More
NEWS
The Federal Reserve's 2025 payment services pricing announcement marks significant updates to its offerings, including the FedNow instant payment service. Since its launch in 2023, FedNow has grown to nearly 1,000 participating financial institutions and processed over 400,000 transactions in 2024. The 2025 pricing structure introduces discounts for smaller volume transactions while maintaining a low fee for credit transfers, reflecting the Fed's push for broader adoption. Legacy payment services are also seeing changes, including new volume-based fees for Fedwire Funds Service and increased costs for Check Services, which continues to face declining usage. Meanwhile, FedACH remains a strong performer, exceeding cost recovery targets and showing steady growth in transaction volumes. In a forward-looking move, the Fed plans to introduce a new fee structure for API services while discontinuing underutilized platforms like FedComplete Premier. These changes signal the Federal Reserve's effort to modernize payment systems, address cost recovery challenges, and position its services for a real-time, digital-first financial landscape. Read More
INSIGHTS
Corporate treasurers face a pivotal moment: adapt into strategic drivers of growth or risk obsolescence. A recent Citi report highlights the urgency, with 93% of treasurers expecting significant evolution by 2030 but over half unsure of the path forward. The transformation requires a dual focus—modernizing legacy systems into real-time, AI-enabled platforms and equipping treasury teams with advanced data and strategic skills. Challenges are steep, from poor data quality and fragmented technology to a skills gap in AI and strategic partnership. Treasurers must also rethink operational norms, moving from traditional banking hours to 24/7 real-time decision-making. AI will play a central role, automating routine tasks while empowering treasury teams to make faster, data-driven decisions. To seize this opportunity, treasury professionals must balance traditional expertise in liquidity and risk management with new capabilities in data science and business strategy. Bold action—upgrading technology, developing talent, and fostering cross-sector collaboration—will be essential to thrive in a digital-first future. Read More
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