In late February, the Home Monetary Providers Committee requested suggestions on its “Make Group Banking Nice Once more” rules. Highlighting the essential function that bank-fintech partnerships play in enhancing entry to monetary providers, the American Fintech Council (AFC), the commerce affiliation representing fintech firms and banks, has submitted a letter in response.
In its letter, AFC focuses notably on the impression partnerships can have on underserved communities. AFC underscores how partnerships between regulated monetary establishments and accountable fintech firms have fueled the event of clear, technology-driven merchandise reminiscent of accountable fintech loans, high-yield deposit accounts, credit score builder instruments, earned wage entry (EWA), and buy-now-pay-later (BNPL) choices.
The letter additionally particulars alternatives for the Committee to assist modernise the supervisory framework governing these partnerships, particularly by enhancing examiner schooling, offering extra activity-specific steering, and creating applications that reward proactive compliance efforts by regulated entities.
AFC additionally encourages continued funding in rising applied sciences reminiscent of supervisory expertise (suptech) to strengthen oversight and cut back regulatory burdens.
“Accountable innovation inside group banks is essential to the resilience of the US monetary system. When paired with accountable fintech companions, they’ll increase entry to protected, revolutionary monetary instruments for shoppers nationwide,” stated Hayden Cole, director of federal authorities affairs on the American Fintech Council.
“We commend Chairman French Hill for his management in exploring a legislative framework to modernise oversight and create an atmosphere the place each accountable innovation and shopper safety can thrive.”
“The way forward for group banking is determined by making a regulatory atmosphere that encourages accountable innovation and helps native establishments as they evolve to satisfy shopper demand,” stated Ian P. Moloney, SVP and head of coverage and regulatory affairs at AFC. “We look ahead to working with Congress to make sure regulatory coverage is pragmatic, constant, and designed to maintain tempo with trendy monetary providers.”
