Congressional Fintech Task Force Hears Arguments On New Rules To Accommodate More Technology Firms
Congressional Fintech Task Force Hears Arguments On New Rules To Accommodate More Technology Firms
October 1, 2020
Congressional Fintech Task Force Hears Arguments On New Rules To Accommodate More Technology Firms
Congressional Fintech Task Force Hears Arguments On New Rules To Accommodate More Technology Firms
October 1, 2020

The Congressional Fintech Task Force heard arguments on new rules that would potentially expand banking regulations to accommodate more technology firms providing financial services.

It has been reported that a subunit of the Financial Services Committee, the Fintech Task Force leads the committee’s examinations of emerging technologies.

Stephen Lynch (D-MA), the Task Force Chair, noted:

“Banking is becoming less centralized. Consumers are facing more choices than they ever have.”

According to the report, much of the back-and-forth in the hearing was as to whether or not loosening the rules of banking, which would allow more firms to, for example, offer loans, would properly extend financial access.

Lynch said:

“One of the great promises of fintech was the idea that it might help us to bank the unbanked. The evidence is really mixed.”

However, in response to a line of questioning from Representative Rashida Tlaib (D-MI) about whether fintech had lived up to this promise, witness Raúl Carrillo of the Demand Progress Education Fund said:

“I have not seen any hard evidence that these private fintech companies are quote unquote saving the day. In fact, I am worried about these transactions happening without proper protections.”

Carrillo also warned against Big Tech entering into finance, in keeping with similar concerns from Maxine Waters (D-CA), Chairwoman of the full committee.

ALSO READ :  Starbucks Mobile App Users Will Soon Be Able To Pay Their Drinks With Bakkt Cash

Carrillo added:

“We are especially concerned by dominant tech platforms’ recent encroachment into payments, most notably the proposed Facebook Libra project.”

Likewise, Everett K. Sands, the founder and CEO of Lendistry, was optimistic about the role of good actors. Lendistry is both a fintech and a Community Development Financial Institution (CDFI).

He called on Congress to provide more “carrots” for good actors as opposed to “sticks” for bad actors: 

“The current rules under SBA [Small Business Administration] and others have been made to be a form of risk management. While we respect them, there needs to be some type of review so that the good guys aren’t fighting their fight with one hand tied behind their backs.”

Moreover, part of the occasion for the hearing is proposed changes to payments charters from the Office of the Comptroller of the Currency, the US’s regulator for federal banks. The office has been extremely active in extending fintech and crypto engagement in traditional finance.

ALSO READ :  Binance Enters The Korean Market With New Business Entity

The hearing was called “License to Bank: Examining the Legal Framework Governing Who Can Lend and Process Payments in the Fintech Age.” Many noted the particular role of crypto in the evolution of payments.

Sands said:

“We also believe lending and payments each require a significant adjustment in regulation, and we would suggest the OCC focus on payments first as new technology entrants like Bitcoin, blockchain and cryptocurrency gain traction.”

Thus, Representative French Hill (R-AK) concluded:

“We need a cryptocurrency payment rail as part of our current payment system reforms.”

Source: Cointelegraph


Disclaimer

Crypto News Point a news platform of Digital Notice Media Labs is primarily a regular publication of information, commentary and articles focused extensively on fintech, blockchain technology, cryptocurrency, blockchain-based tokens, cryptocurrency market trends, and trading strategies. We do not provide individually tailored investment advice and does not take a subscriber’s or anyone’s circumstances into consideration when discussing investments, nor is Crypto News Point registered as an investment adviser or broker-dealer in any jurisdiction. Information contained herein is not an offer or solicitation to buy, hold, or sell any digital assets.

Affiliate Disclosure: To help support the work we do here at CNP, we often link to products and deals from around the web. Should you buy some of these, we may get a portion of the sale.

We in generally gather content from the major websites. In every article there is always a clear link and attribution to the source publication. If you have any issue with any of our published content taken from your site, kindly let us know so that we can take appropriate action. In any case, the content of the pages of this website is for your general information and use only. It is subject to change without notice.

You May Also like

Ishita Bora

Ishita Bora is a Senior Content Creator at Digital Notice Media Labs with an experience of 1 year. She has completed her Master's Degree in Language and Linguistics in 2019 from Gauhati University, India. Her interest lies in blockchain technology and cryptocurrency space, as she loves writing about blockchain and other blockchain-related articles. Currently, she is working on blockchain-based news, reviews, featured articles, and guides.
Share This

Share This

Share this post with your friends!