Roughly 22.7 million American borrowers had an outstanding unsecured personal loan at the end of June 2023, with loans from financial technology firms a significant driver of new unsecured loans, the Federal Reserve Bank of New York said in a report.
All banks should conduct a gap analysis to identify opportunities to strengthen their TPRM programs and align them with the new guidance.
As banks become increasingly reliant on third-party service providers, Federal Reserve Governor Michelle Bowman said bank regulators should “consider the appropriateness of shifting the regulatory burden from community banks to more efficiently focus directly on service providers.”
“The crux of the issue is that ultimately the bank has to have a strong oversight and management system.”
The Federal Reserve today published for comment updates to the proposed guidelines it will use when evaluating requests for master accounts with the Fed or access to the agency’s financial services.