‘Payment charter’ closed process, ambiguity lead to concerns

Credit unions welcome fintech innovation and competition but are concerned that many products and services offered by fintechs skirt consumer protection regulations, CUNA wrote to the House Financial Services Task Force on Financial Technology Tuesday. An example cited by CUNA is a “payment charter” proposed by Acting Comptroller of the Currency Brian Brooks.

“Recently, Acting Comptroller of the Currency, Brian Brooks, has proposed what has been called a “Payment Charter,” but this appears to be a national money transmitter license that preempts state licenses requirement and provide a possible onramp for nonbanks to directly access to the Federal Reserve’s payment clearing system,” the letter reads. “The Acting Comptroller has indicated in several forums that the OCC does not need to pursue rulemaking for the payments charter and that the Acting Comptroller can approve this charter at any time.

CUNA opposes the so-called payments charter,” it adds. “We believe the OCC should undertake an open and transparent process in considering new charters. This process was followed with the notice and comment rulemaking process for the fintech charter, but has not been done with payments charter.”

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