CUNA supports the Consumer Financial Protection Bureau’s (CFPB) innovation mission and the use of “Tech Sprints,” but credit unions must have a seat at the table, CUNA wrote Friday. Tech Sprints gather regulators, technologists, financial institutions, and subject matter experts from key stakeholders for several days to work together to develop innovative solutions to clearly-identified challenges.

“CUNA supports the CFPB’s potential use of Tech Sprints as a method to encourage regulatory innovation and collaborate with stakeholders to address regulatory compliance challenges,” the letter reads. “However, CUNA strongly recommends the Bureau ensure credit unions are appropriately represented in any future Tech Sprint since credit unions, as the only not-for-profit financial cooperatives in the market, have unique needs and perspectives on regulatory burden and innovation.”

The CFPB sought information on how it could use Tech Sprints to advance regulatory innovation and compliance.

In its letter, CUNA also called for the CFPB to appropriately tailor its regulations to reduce associated burdens on community-based financial institutions.

“Right-sized regulations would ensure small financial institutions have more resources available to

invest in technology and the specific needs of their communities,” it reads. “In its rulemaking efforts, the Bureau should reduce regulatory burden for financial institutions with lower risk profiles relative to systematically significant institutions. Constant regulatory changes present a challenge for small depository institutions because the fixed costs of compliance are proportionately higher for smaller-sized credit unions and banks than for large institutions.”

CUNA also noted its support for the CFPB’s “Product Sandbox” as a method to facilitate innovative products. The CFPB’s sandbox enables testing of a financial product or service where there is regulatory uncertainty.

“However, we continue to encourage the Bureau to avoid creating an uneven playing field and limit the number and scope of products approved to participate in the Product Sandbox,” the letter reads. “We have also recommended, in the interest of market transparency and encouraging entity participation, the Bureau make information publicly available regarding Product Sandbox applications that are approved and/or denied.”