Federal Reserve pricing policy change sparks competition among banking industry.
The Federal Reserve changed its pricing policy in 1981 to reflect all costs of production, including taxes and capital returns. This was due to the Monetary Control Act of 1980, which aimed to give all banks equal access to Federal Reserve services. Before this, only member banks had direct access to these services for free. The new pricing policy was meant to make the Fed compete with private banks and encourage more efficient use of resources.