Fintechs are circumventing consumer protection rules by exploiting regulatory gaps to provide financial services, CUNA wrote to House Financial Services Committee Task Force on Financial Technology.
“Credit unions want to ensure that financial products and services available from fintech companies or any company offer the same protections as those offered by regulated entities. Our members do not want to discourage innovation, they merely want to ensure that innovation does not allow new entrants to make an end-run around regulation,” the letter reads.
CUNA commended recent actions by the Office of the Comptroller of the Currency (OCC) to regulate fintechs under a national bank charter but urged Congress to consider more consistent and comprehensive regulation to protect consumers and the financial industry.
Additionally, CUNA raised concerns over consumers’ data security and privacy, calling on the Consumer Financial Protection Bureau (CFPB) to closely examine tech companies’ practices to ensure credit union members’ data is kept safe regardless of the entity collecting it.
“Everyone should be safeguarding consumer information, especially those that house and use it the most. Any sharing of information that leads to less protection of credit union members’ valuable information — and that leads to members being less protected or at worst exploited — is not supported by CUNA and our member credit unions.”