Payment systems can present a variety of risks to the Federal Reserve Banks, the banking system and other sectors of the economy. Risks can arise from transactions that are processed in Federal Reserve payment systems and in private sector payment systems. To address these risks, the Federal Reserve developed the Payment System Risk Policy.

As overseer of payment systems, the Federal Reserve administers and applies this Policy. The Federal Reserve's Payments System Policy Advisory Committee advises the Board on issues related to payments system risk.

Additionally, the Federal Reserve has responsibility for implementing certain laws pertaining to a wide range of banking and financial activities, including payment activities.