Three federal banking regulators said on Thursday they are considering “additional measures” to help banks effectively manage the risks associated with bank-fintech partnerships.
The authorities: Joint statement Investigate banks’ third-party deposit agreements; Request Information About collaboration between banks and fintech.
of Federal Reserve Board, Federal Deposit Insurance Corporation (FDIC) and Office of the Comptroller of the Currency (OCC) issued a joint statement and a separate request. press release On Thursday.
The statement reminds banks of the potential risks involved in arrangements with third parties that provide bank deposit products and services, and while the regulators support responsible innovation, they identify some concerns about how the arrangements should be managed.
“The statement details the potential risks and provides examples of effective risk management practices for such arrangements,” the regulators said in a statement. “In addition, the statement reminds banks of existing relevant legal requirements, guidance and related resources, and provides insights the regulators have gained through their supervision.”
“This statement does not prescribe new supervisory expectations,” they added.
Another information request issued on Friday covers a wide range of arrangements between banks and fintechs, including those relating to deposit, payment and lending products and services.
“The authorities are seeking comment on the nature and impact of bank-fintech collaborations, as well as effective risk management practices,” the authorities said in a statement. “The authorities are considering whether additional measures could help banks effectively manage the risks associated with these different types of collaborations.”
PYMNTS Intelligence found that in 2021, nearly two-thirds of banks and credit unions had partnered with a fintech in the past three years, and nine in 10 banks consider partnering with fintechs at least somewhat important.
Banks and fintechs are moving toward collaboration as they adapt to changing customer preferences, economic pressures and regulatory challenges, according to PYMNTS intelligence and research firm. Sezzle Collaboration: “The relationship between fintechs and banks is moving towards collaboration”
Tackling the relationship between banks and fintech Charlie Euakim“Together, our companies are driving innovation to transform financial services and create a more seamless and personalized banking experience for customers,” Sezzle CEO David K.
