For the Fed, most investors only care about when the central bank plans to cut interest rates and Fed Chair Jerome Powell's views on inflation. But another initiative underway at the Fed could have major implications for two top financial stocks and has nothing to do with decisions on monetary policy.

The Fed launched FedNow, an instant payment service last July. It allows for real-time digital payments at cheaper prices than using bank debit cards or the Automated Clearing House system(ACH). Over 800 financial services companies have registered to use FedNow, including JPMorgan Chase & Co(JPM.N), Wells Fargo & Co(WFC.N), and U.S. Bancorp(USB.N). Susquehanna Securities analysts Dan Dolev and Ryan Coyne believe this could be detrimental to payment giants Visa(V.N) and Mastercard(MA.N).

The two payment processing giants are the backbone of many debit card transactions. Although they have their own instant payment transfer services - Visa Direct and Mastercard Send - Dolev fears that FedNow will erode their business.

Dolev told Barron's, 'FedNow is cheaper per transaction than a debit card.' He added that it's only a matter of time before more big banks join the FedNow network. Others hold a similar view.

TD Cowen analysts Moshe Orenbuch and Bryan Bergin wrote in an April report on Visa and Mastercard: 'Given that it is being developed by the Fed, we believe it is inevitable that most financial institutions will ultimately consolidate onto the system.' The analysts added that "FedNow's actual usage cases remain very limited to date."

Are investors of Visa and Mastercard worried about more competition? The stocks of both companies have risen about 15% over the past year, which is not a bad performance. However, it's worth noting that the performance of these two stocks has lagged behind the S&P 500 index and the Financial Select Sector SPDR Exchange Traded Fund, which have each risen about 25% over the past 12 months.

Of course, concerns about Visa and Mastercard's monopolistic position facing increasing competition have been around for some time. They have been competing with big banks in payments, as several banks, including Bank of America(BAC.N), Capital One(planning to acquire Visa and Mastercard competitor Discover Financial Services for over $35 billion) and JPMorgan Chase have participated in the network with Zelle digital currency transfer services.

Visa and Mastercard are also increasingly competing with fintech companies such as Venmo owner PayPal(PYPL.O), Block's(SQ.N) Cash App and Square, and installment payment leader Affirm Holdings(AFRM.O).

But there are also other ways to invest in the growth potential of the FedNow service. Dolev says that tech companies Fiserv and Fidelity National Information Services are 'channels that connect consumers with banks' and should benefit from growth in FedNow and other digital payment services.

TD Cowen analysts also believe that investors should not count out Visa and Mastercard. The analysts wrote in their report that both companies 'have a built-in advantage in instant payment infrastructure' and that they 'focus on payments, enabling them to make significant investments in technology and fraud detection over the long term.'

FedNow is still in its early stages of promotion. So, this is a threat that needs to be closely monitored. But even if the latest competitor is a significant participant in the regulatory field in Washington rather than a Silicon Valley start-up or a Wall Street banking giant, Visa and Mastercard's increasing competition from fintech companies is not new.