Fintech
US regulators seek insights into bank-fintech relationships
U.S. banking regulators have issued a warning about potential risks associated with third-party deposit arrangements and asked for more information about relationships between lenders and fintechs.
In a joint statement, the Federal Reserve, the FDIC, and the Office of the Comptroller of the Currency released a request for information on a wide range of agreements between banks and fintechs, including deposit, payment and lending products and services.
The agencies are “seeking input on the nature and implications of arrangements between banks and fintechs and effective risk management practices” as they consider next steps.
Separately, regulators noted that some banks have partnered with third parties to provide deposit products and services, such as checking and savings accounts.
“A bank’s use of third parties to perform certain activities does not diminish its responsibility to comply with all applicable laws and regulations,” regulators warn.
Such arrangements carry risks, such as reduced control, lack of access to records, third-party compliance issues and insufficient risk management for consumer protection.
While it doesn’t set new expectations, the declaration reminds creditors of existing legal requirements, guidelines, and related resources.