ARLINGTON, Va.—Ahead of this week’s House Financial Services Committee’s Financial Technology Task Force hearing, NAFCU has repeated the association's call for “competitive equality” between traditional financial institutions and fintech companies.
In the letter, NAFCU Vice President of Legislative Affairs Brad Thaler told the committee industrial loan company (ILC) charters and the Office of the Comptroller of the Currency’s (OCC) payment charter “frustrate the goal of establishing a level playing field by permitting recipients of either license to reduce the extent of federal supervision compared to traditional financial institutions.”
“NAFCU believes that regulators should not give preference to fintech as a new model of banking ready to replace traditional institutions, but rather seek to modernize traditional supervisory frameworks to ensure that the promise of better, more efficient service and expanded access to credit is predicated on responsible innovation rather than regulatory arbitrage,” wrote Thaler.
In addition, Thaler called for a “full and transparent rulemaking process to allow for careful consideration of how recipients of fintech-specific charters might impact the safety and soundness of the financial sector, should regulators seek to introduce specialized chartering options.”