OCC to Move Forward with Plans for Fintech Bank Charter

The OCC will move ahead with plans — first announced under Comptroller Joseph Otting’s predecessor — to consider applications from fintech companies for special-purpose national bank charters, the agency said today. The OCC released a policy statement in tandem with the Treasury Department’s report on fintech following a two-year process of collecting input from the public, including extensive engagement by American Bankers Association staff and leaders.

“On the heels of the Treasury report, we are pleased to see the Office of the Comptroller of the Currency moving forward with their new fintech charter that maintains the strict safety and soundness requirements all banks face today,” said ABA President and CEO Rob Nichols. “Today’s OCC announcement supports a dynamic banking industry where all players must meet the same high standards, face the same regulatory oversight and share the same affirmative responsibility to serve their communities.”

The OCC’s announcement comes as the financial industry sees accelerating technological change. “[C]ompanies that engage in the business of banking in new and innovative ways should have the same opportunity to obtain a national bank charter as companies that provide banking services through more traditional means,” the agency said. “The OCC will require these new entrants to the national banking system to adhere to the same high standards that apply to all national banks.”

Specifically, the OCC said that any special-purpose charters granted will be required to “demonstrate a commitment to financial inclusion,” meeting “a high standard similar to the Community Reinvestment Act’s expectations for national banks that take insured deposits.” The agency’s revised licensing manual describes the supervisory, capital, liquidity and contingency planning requirements it will impose. “[T]he OCC will not approve proposals that are contrary to applicable law, regulation, policy, or safety and soundness,” the agency said. “Exercising the OCC’s existing authority to grant special purpose charters does not alter existing barriers separating banking and commerce.”