There are ways the Federal Reserve discount window processes could be more efficient, America’s Credit Unions wrote in response to a Federal Reserve Board of Governors’  request for information regarding changing operational aspects of the window.

The discount window allows credit unions and other eligible institutions to borrow from Federal Reserve Banks after executing legal agreements and pledging collateral. The comment letter sent Monday outlines several actions the Board should consider to alleviate inefficiencies:

• Explore options to reduce the frequency of pledge files submitted to Federal Reserve Banks to comply with Borrower-in-Custody (BIC) program requirements;
• Adopt an extended schedule for pledge file submission for depository institutions that have not received any intraday credit for a specified period of time;
• Survey BIC program requirements at individual Reserve Banks to determine whether there are barriers to accepting electronically signed loans as collateral;
• Review BIC program requirements that limit acceptance of electronically signed notes and explore ways to alleviate these obstacles, or otherwise standardize procedures for accepting electronically signed loans; and
• Consider publishing a request for information inviting comment on how BIC programs might be improved and include information about state laws that limit acceptance of collateral bearing electronic signatures.

Read the full letter here.