A federal judge in New York yesterday blocked the OCC from issuing charters to non-depository special-purpose national banks, as the agency first proposed to do in 2016. The so-called fintech charter would have provided fintech firms with a consistent nationwide regulatory framework and would have imposed bank-like standards for capital, regulatory compliance and financial inclusion.
After Judge Victor Marrero declined to dismiss the case, holding that the National Bank Act does not permit the OCC to grant national bank charters to non-depository institutions without a statutory exception, he issued a judgment requested by the New York Department of Financial Services that vacated on a nationwide basis the OCC regulation permitting these charters. The OCC disagreed with the order, telling Politico that it would appeal Judge Marrero’s ruling.
