ARLINGTON, Va. –NAFCU has released a new video it said is designed to urge policymakers to ensure a level playing field between fintechs that are granted bank charters and financial institutions.
Many fintech companies are offering various consumer financial products and services but are underregulated and not subject to the same oversight as credit unions and banks, NAFCU said.
“While financial technology companies begin to acquire bank charters but remain unchecked, NAFCU has released a new video to bring awareness to the growing risk this poses to the financial system,” said NAFCU President and CEO Dan Berger. “NAFCU believes federal financial regulators have a role to play in the supervision and regulation of fintechs under their existing authorities.
"Fintech companies have taken root in the cracks of a fragmented regulatory system, and consumers deserve to be fully aware of what this landscape might entail, including lack of oversight of data and lack of guarantees on funds,” Berger continued. “The longer this mounting issue goes on without proper supervisory oversight, the greater the risk of a significant loss or violation of consumer rights. Federal regulators must ensure that new models of banking are held to the same high standards that exist for credit unions and banks. A level playing field for all financial institutions is necessary to prevent damage to the financial system.”
The video can be viewed here.