# Fed Modernizes Discount Window to Support Treasury Market Resilience

By Riza Dagoc

Canonical URL: https://www.tokenpost.com/news/regulation/24938
Published: 2026-09-28T14:14:24.000Z
Updated: 2026-09-28T14:14:24.000Z
Section: Regulation

> More than 60% of discount-window loan requests had been submitted through Discount Window Direct as of Sept. 22. The Fed also standardized collateral systems across its 12 districts.

Federal Reserve Vice Chair Philip N. Jefferson said the central bank’s updated discount window can make it easier for banks to access liquidity and help limit Treasury sales during market stress.

More than 60% of discount-window loan requests had been submitted through Discount Window Direct as of Sept. 22, when Jefferson spoke in New York. The online platform, launched in 2024, allows banks to request loans, make payments, review loan and collateral information, submit collateral files electronically and message their local Reserve Bank.

The modernization effort combines business-process improvements, automation and coordination with the Federal Home Loan Banks. The 12 Federal Reserve districts now use a common collateral framework, loan-valuation models and processing technology, while accepting electronic signatures.

Recent changes include simpler forms, faster enrollment, automated pledged-loan lists and centralized information resources. Eligible institutions can pledge several types of loans while retaining possession of the collateral.

The discount window allows eligible depository institutions and U.S. branches and agencies of foreign banks to borrow from Federal Reserve Banks after signing legal agreements and pledging collateral. Primary-credit loans are available overnight or for terms of up to 90 days.

“Today, over 60 percent of discount window loan requests are submitted through DWD,” Jefferson said.

Jefferson said easier access to discount-window liquidity can reduce pressure on banks to sell Treasury securities during periods of stress. Treasury securities pledged to the Fed rose sharply in March 2020, when the Treasury market experienced severe dysfunction.

“The discount window supports Treasury market resilience in important ways,” Jefferson said.

The Fed’s September 2024 survey recorded an average operational-burden rating of 2.6 out of 5 for pledging loans as collateral, compared with 2.0 for pledging or withdrawing securities. Securities pledges are generally effective the same day, subject to depository operating hours.

The general deadline is 3:15 p.m. ET (19:15 UTC) for securities transferred from another Fedwire Securities Service participant and 7 p.m. ET (23:00 UTC) for securities already held in an institution’s own account.