Despite having a strong tradition of bringing innovative financial products to consumers, fintech companies can sometimes face an uphill battle when competing against traditional banks. However, recent proposed regulatory changes could help even the playing field for fintech firms.
In new payment industry trends, the head of the Office of the Comptroller of the Currency, Thomas Curry will for the first time begin granting banking licenses to fintech firms. This decision by the government will give fintech companies the opportunity to more easily do business across state lines without getting individual state government’s permission. Fintech’s also won’t have to rely on or partner with brick-and-mortar banks.
This decision will create more competition between older, more established banks and innovative fintech firms. It will also create opportunities for tech companies to figure out new ways to bring digital payments and other financial services to consumers. This new competition will ultimately help consumers find better financial products and easier access to the financial industry.
While the proposal is great news for fintech, there is still much work to be done for the measure to be approved. Public comments will be accepted through January 15th, 2017 and many expect traditional banks will come out strongly against the measure. Fintech companies and proponents are encouraged to email their support of the proposal to firstname.lastname@example.org. For more information regarding the proposal, please click here.
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