U.S. banking regulator not ready for fintech charter applications

Stocks and Financial Services Press Releases Thursday September 14, 2017 17:08
The Asian Banker--14 Sep--Asian Banker
The U.S. banking regulator, the Acting Comptroller of the Currency, said that he is not ready to accept applications from financial technology companies seeking a special purpose federal charter.

Keith Noreika, who took over as acting head of the Office the Comptroller of the Currency (OCC) in May, said at an industry conference in New York that the agency was still in the exploratory phase of its so-called fintech charter, which it first unveiled in 2016 and which sparked controversy.

His comments underscore the broader difficulties faced by regulators globally as they attempt to keep up with dramatic changes in banking industry brought about by the increasing use of digital technologies which threaten to undermine traditional financial services businesses.

"We aren't yet ready to accept applications because we want to just talk to these companies to get a sense of what your business line is before we entertain applications," Noreika said in an interview with Reuters prior to the conference.

The OCC is, however, processing applications from fintech companies seeking traditional forms of bank charters, such as licenses that are issued to deposit-taking institutions and credit-card providers. Mobile banking startup Varo Money is one of such companies that has applied for a banking charter.

"We approach this from what we have a specialty with which is what we know the best - we know full service banks the best," Noreika said.

The OCC has been sued by the New York Department of Financial Services and a nationwide organization of bank supervisors after it announced last year that it was considering granting special charters to companies such as online lenders.

The lawsuit argues that the federal regulator does not have the authority to grant special charters and could lead to weaker consumer protection.

Noreika said the OCC had filed a motion to dismiss the cases because the agency is not "anywhere near deciding whether we're actually going to use" it and so it believes there is no federal jurisdiction to hear the case.

Re-disseminated by The Asian Banker from Reuters
--www.theasianbanker.com (Sep 14, 2017)--

Latest Press Release

KTC joins hands with partners to launch new payment method Garmin Pay.

Mrs. Pittaya Vorapanyasakul (right center), Executive Vice President - Credit Card Business, "KTC" or Krungthai Card Public Company Limited together with Mr. Krairop Luang U-Thai (left center), General Manager, GIS Company Limited, Miss Aileen Chew...

Photo Release: Newly redesigned K-Cash Connect Plus website to facilitate business customers

Mr. Silawat Wantivisat, KBank Executive Vice President, introduced the newly redesigned K-Cash Connect Plus website, which is more user-friendly for business customers to facilitate their online financial transactions and data verification with greater...

Newly redesigned K-Cash Connect Plus website to facilitate business customers

K-Cash Connect Plus website has been redesigned to be more user-friendly, focusing on online financial transactions and financial data verification with greater convenience and speed. The website now supports all types of browsers, without the...

Bangkok Bank showcases #B-Advice at #SET in the City 2018 and joins with partners and subsidiaries to help customers build long-term wealth in a digital age

Bangkok Bank joins with its business partners and subsidiaries to offer a variety of financial and investment products to answer the needs of customers in a digital age at 'SET in the City 2018'. These products include 'B-Advice', financial investment...

Photo Release: SCB wins Global Finances Worlds Best in Social Media Marketing and Services and Best Consumer Digital Bank in Thailand Awards

Siam Commercial Bank recently received world class honors for its lifestyle banking leadership at Global Finance's World's Best Digital Bank Awards 2018, where the bank won awards for World's Best in Social Media Marketing and Services and Best Consumer...

Related Topics