WASHINGTON—The FDIC has issued a new warning to consumers about using neobanks and fintech companies for banking.
Specifically referring to third-party banking apps and nonbank companies that offer banking services, the FDIC said, “You may want to be particularly careful about where you place your funds, especially money you rely on to meet your regular day-to-day living expenses,” Forbes noted. “This warning comes as a fintech banking crisis has left millions of Americans unable to access their funds due to do the shutdown of a software provider that acted as a bridge between banking services and real banks.
‘Certain Criteria’ Required
“For Americans who rely on banking apps, this warning should serve as a reminder that for FDIC protection to be in effect, certain criteria must be met and even if your funds are protected, there may be a very long process before you actually get your money,” Forbes added.
The report notes and as credit unions are well aware, over the last decade nonbank financial companies have emerged as a popular option for consumers.
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