The Office of the Comptroller of the Currency will begin considering applications from financial technology companies to become special purpose national banks, but ICBA expressed concerns with the plan.
Announcing the decision, Comptroller Thomas Curry said fintech companies have the potential to expand financial inclusion and empower consumers. In a white paper accompanying the announcement, the OCC said applying a bank regulatory framework to fintech companies will help ensure they operate in a safe and sound manner.
In response, ICBA said that while it supports oversight of these unregulated firms, a fintech charter poses risks to taxpayers and the financial system by endowing these nonbank companies with a federal bank charter.
“ICBA has been deeply concerned that nonbank online lenders’ lack of oversight has provided them with regulatory advantages over other institutions—such as highly regulated community banks—while putting consumers and the financial system at risk,” ICBA President and CEO Cam Fine said. “Any limited fintech charter must hold these companies to the same standards of safety, soundness and fairness as other federally chartered institutions.”
ICBA is reviewing the OCC’s plan and will provide formal comments to the agency. Read ICBA Release. Read More from OCC.