Fintechs must offer same consumer protections as CUs, banks
Technology has improved consumer access to financial services, but certain new financial technologies, or fintech, does not have the regulatory structure in place that exists with credit unions and other financial institutions, CUNA wrote to the House Financial Services Task Force on Financial Technology Tuesday, the task force conducted a hearing featuring domestic and international regulators sharing their perspective on fintech regulation.
“Although CUNA supports the innovations developed and brought into the marketplace by fintech, we remain concerned the regulatory environment might create an environment in which consumers do not receive the same protections from unregulated businesses that offer services traditionally offered by credit unions and banks,” writes CUNA President/CEO Jim Nussle. “A regulatory scheme that ensures consumers receive the same protections and those offering these services are subject to similar regulations and supervision credit unions and banks is important to safeguard consumers and the banking system.”
Nussle notes that credit unions embrace technological innovation from businesses that normally operate outside of the financial services sector, as “consumers can benefit from fresh ideas and new ways to deliver financial services.”
“Credit unions are partnering with fintech companies to ensure that they continue to offer essential financial services in the most efficient and modern way possible,” Nussle writes. “When credit unions and other financial services organizations offer tools and resources they do so under the supervision of federal and state regulators and also are required to follow many different laws that ensure protection of consumers.”