AFC urges regulators to retain limited purpose bank designation, maintain strategic plan flexibility, and avoid removing critical deposit product opportunities

Washington, DC (October 13, 2026) – The American Fintech Council (AFC), the largest industry association representing both responsible fintech companies and innovative banks, submitted a comment letter in response to the Office of the Comptroller of the Currency’s (OCC) and Federal Deposit Insurance Corporation’s (FDIC) Notice of Proposed Rulemaking regarding Community Reinvestment Act (CRA) regulations. AFC commends the agencies’ efforts to restore clarity and flexibility to CRA regulations, while cautioning that several proposed changes, specifically the elimination of the limited purpose (LP) bank designation, could create regulatory bottlenecks and undermine community reinvestment efforts of innovative banks.

“A modernized CRA framework should reflect how financial services are delivered today, ensuring that low- and moderate-income consumers can continue to benefit from expanded credit access and responsible innovation,” said Phil Goldfeder, CEO of the American Fintech Council. “As the association representing the nation’s most innovative banks, AFC knows firsthand the critical access to financial services these institutions provide. We thank Comptroller Gould and Chairman Hill for their continued leadership in driving innovation at the OCC and FDIC, and we look forward to working with both agencies to get this right.”

AFC recommends the OCC and FDIC preserve the LP bank designation as a distinct evaluation pathway for institutions with specialized business models and narrow product offerings. AFC emphasizes that strategic plans must remain a flexible alternative evaluation method. Strategic plan banks should retain discretion to establish measurable goals tailored to their product mix and institutional capacity. AFC also calls for the establishment of a collaborative pre-filing process, time-limited review windows, a public database of approved plans, and clear grandfathering protections for plans under development or approved.

“A modern and practical CRA framework must evaluate financial institutions based on where they deliver real-world impact, rather than forcing diverse business models into generic regulatory categories,” said Ian P. Moloney, Chief Policy Officer at the American Fintech Council. “We appreciate the OCC and FDIC engaging on this important issue. However, we recommend that they avoid eliminating existing aspects of the CRA framework that help ensure innovative banks can receive proper CRA credit for their lending and non-lending programs. Maintaining these opportunities to obtain CRA credit will help ensure that innovative banks can continue to serve historically underserved communities in a way that meets consumers’ diverse needs and that these institutions receive the proper credit for providing these services.”

AFC advocates for a materiality-based major product line framework to ensure CRA evaluations focus on meaningful consumer impact. Evaluating consumer lending products on a product-by-product basis risks fragmenting supervisory analysis and penalizing minor volume shifts. AFC urges regulators to recognize safe deposit products that expand financial inclusion, adopt a channel-neutral approach for responsible bank-fintech partnerships, and provide clear recognition for digital lending that serves low- and moderate-income borrowers.

A standards-based organization, the American Fintech Council (AFC) is the largest and most diverse trade association representing financial technology (fintech) companies and innovative banks. On behalf of nearly 175 member companies and partners, AFC promotes a transparent, inclusive, and customer-centric financial system by supporting responsible innovation in financial services and encouraging sound public policy. AFC members foster competition in consumer finance and pioneer products to better serve underserved consumer segments and geographies.

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