“The updated guidance serves as a unifying voice from the federal banking regulators and provides vital clarity around bank-fintech partnerships. The guidance recognizes the benefits that responsible fintech companies provide for consumers in need but more importantly helps identify the risks, roles and responsibilities to keep community banks competitive without compromising on consumer safety. This guidance should help mitigate information asymmetries and provide clear expectations on the processes that banks should pursue as it relates to managing third party relationship risks.

We were pleased to provide our insight in October of 2021 and happy that federal regulators have moved forward with this unified update to third-party banking guidance. Over the last fifteen years, fintech innovators have been transforming the way Americans bank, lend, and transact, levelling the playing field for millions of consumers and businesses and opening up access to capital to long underserved communities.

Unfortunately, we are still facing a crisis of significant mismatch between the fintech services used to conduct our daily lives and the regulatory mechanisms designed to support these innovations, root out bad actors, and ensure strong industry-wide compliance and responsible capital management. The updated guidance will help ensure that responsible bank-fintech partnerships and companies who are committed to compliance, transparency and accountability will continue to thrive.

This is an important step forward and we urge federal regulators to increase engagement with state regulatory agencies and policy makers to streamline the current patchwork of rules and regulations and ensure consistent enforcement throughout our industry.”