US Treasury seeks fintech industry to treasure
The US Department of the Treasury has released a report identifying improvements to the regulatory landscape that it reckons will create a wonderful and dreamy world for fintech.
In the 222-page report, “A Financial System That Creates Economic Opportunities: Nonbank Financials, Fintech, and Innovation”, it’s pretty obvious what it wants.
Secretary of the Treasury, Steven T. Mnuchin, says: “American innovation is a cornerstone of a healthy US economy. Creating a regulatory environment that supports responsible innovation is crucial for economic growth and success, particularly in the financial sector.”
The report issued is the Treasury’s fourth (and final) report in response to Executive Order (EO) 13772. Issued by President Trump in February 2017, this EO calls on the Treasury to identify laws and regulations that are inconsistent with the core principles for financial regulation it set forth.
In drafting the report, the Treasury consulted with a people and firms focused on consumer financial data aggregation, lending, payments, credit servicing, and innovation.
The report identifies just over 80 recommendations to make things better.
One example caters to the demand for short-term, small-dollar loans. The Treasury recommends that the Consumer Financial Protection Bureau (CFPB) rescinds its Payday Rule, which applies to nonbank short-term, small-dollar lenders, as the states already maintain the necessary regulatory authorities and the rule would further restrict consumer access to credit.
Elsewhere, the report looks at open banking in the UK.
The Treasury says: “There are significant differences between the US and UK with respect to the size, nature, and diversity of the financial services sector and regulatory mandates. Given those differences, an equivalent open banking regime for the US market is not readily applicable. Nonetheless, as open banking matures in the UK, US financial regulators should observe developments and learn from the British experience.”
You can read the full report here. All 222 pages.
Staying on the theme of an American dream, today (1 August), we reported that the US Office of the Comptroller of the Currency (OCC) is now accepting applications for national bank charters from non-depository fintech firms.
While last month, the CFPB launched a regulatory sandbox to promote fintech development.