Federal Reserve Vice Chair Jefferson makes the case for discount window modernization at Treasury Market Conference

The Federal Reserve’s discount window has been around since 1913. For most of that time, banks have treated it like a fire extinguisher behind glass: essential in theory, embarrassing to actually use. Vice Chair Philip N. Jefferson wants to change that. Speaking at the 12th annual US Treasury Market Conference at the Federal Reserve Bank of New York on September 22, Jefferson outlined ongoing efforts to modernize the discount window and explained why those efforts matter for the broader Treasury market. His session, titled “Discount Window Modernization and Treasury Market Functioning,” tackled one of the financial system’s most persistent contradictions: the Fed built a tool specifically for banks to borrow from in times of stress, and then watched as stigma made banks reluctant to touch it. What the Fed has been building One of the most tangible upgrades has been the launch of “Discount Window Direct,” an online portal that lets banks request loans around the clock. The Fed also updated its collateral-margin tables, with new schedules taking effect in July 2025. Separately, improvements to the Borrower-in-Custody program were implemented in September 2026, giving banks more flexi...