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Acting CFPB Director Mick Mulvaney
Mick Mulvaney, director of the Office of Management and Budget (OMB), listens during a Senate Budget Committee hearing in Washington, D.C., U.S., on Tuesday, Feb. 13, 2018. Mulvaney discussed the $4.4 trillion federal budget plan that would slash entitlements and other domestic programs in favor of higher spending on the military and immigration enforcement. Photographer: Zach Gibson/Bloomberg
On an argument from a former Consumer Financial Protection Bureau official about how the agency can better foster innovation:

"Updating fintech regulations is a necessity recognized by lawmakers, yet this necessity has not been implemented. This article defines the problem and gives the solution. Is anyone listening?"

Related: Here’s what the CFPB’s sandbox should look like
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Caution Sign - Crisis Ahead
On a look into whether fintechs present a systemic risk to the banking system:

"This failure of oversight has been going on for years. The main card processing companies are independent and unregulated. They are the quintessential SIFI yet the Financial Stability council ignores them. If one of them goes down transactions would be massively disrupted nationally. A prudent level of regulation could start there with oversight of their financial condition, technology and developing contingent receivership plans."

Related: Are fintechs a systemic risk?
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Caucasian business hands holding tablet with business screen
Another reader weighs in on the risks fintechs could pose to the financial system:

"Along with all the well-laid out risks in this article is another scary prospect; loosely regulated fintech companies gaining access to the bank payments system. Despite rigorous operational controls, robust regulatory supervision and comprehensive audit oversight, cybersecurity is a constant and existential threat to the banking system. The possibility of a fintech with less stringent controls providing a port of entry for hackers to the broader payments system is a real nightmare."

Related: Are fintechs a systemic risk?
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Internet Security concept
An additional reaction to concerns that fintechs make the financial system more vulnerable:

"Along with all the well-laid out risks in this article is another scary prospect; loosely regulated fintech companies gaining access to the bank payments system. Despite rigorous operational controls, robust regulatory supervision and comprehensive audit oversight, cybersecurity is a constant and existential threat to the banking system. The possibility of a fintech with less stringent controls providing a port of entry for hackers to the broader payments system is a real nightmare."

Related: Are fintechs a systemic risk?
Sen. Elizabeth Warren
Senator Elizabeth Warren, a Democrat from Massachusetts, waits to begin a Senate Banking Committee confirmation hearing with Marvin Goodfriend, governor of the Federal Reserve nominee for U.S. President Donald Trump, not pictured, in Washington, D.C., U.S., on Tuesday, Jan. 23, 2018. Goodfriend said he hoped to keep the U.S. central bank alert to future challenges while increasing transparency and accountability. Photographer: Andrew Harrer/Bloomberg
On an argument that there could soon be renewed attention on the Glass-Steagall Act:

"If (and it is a big If) the Dem's regain control of the House, they will be too busy focusing on impeachment and otherwise grandstanding to pay much attention to something as complex as Glass-Steagall. Plus, there is the matter of the Senate and Presidential Pen, which will likely stymie most anything coming out of a Democrat House. Repeal of GS is a long shot at best."

Related: Is Glass-Steagall poised for a political comeback?
Fannie Mae building
A Fannie Mae logo is pictured outside their headquarters in Washington, DC, on Wednesday, December 29, 2004. Fannie Mae, the biggest provider of money for the U.S. mortgage industry, will sell as much as $4 billion of preferred stock after its regulator said it broke accounting rules and is ``significantly undercapitalized.'' Photographer: Jay Mallin / Bloomberg News
On Rep. Jeb Hensarling introducing legislation with Rep. John Delaney that would repeal Fannie Mae and Freddie Mac and expand Ginnie Mae's role in the system:

"What an ineffective joke."

Related: Hensarling gives GSE reform another try
carson-ben-bl012716
Ben Carson, retired neurosurgeon and 2016 Republican presidential candidate, listens to a question during a Bloomberg Politics interview in Des Moines, Iowa, U.S., on Wednesday, Jan. 27, 2016. Carson has made his Christian faith and the kind of issues that motivate faith-based voters a central part of his pitches to Iowa's heavily evangelical Republican caucus-goers but in the state that will kick off voting for a presidential nomination with its Feb. 1 caucuses, hes being bested by Donald Trump. Photographer: Andrew Harrer/Bloomberg *** Local Caption *** Ben Carson
On a look at whether the new bipartisan plan to overhaul the housing finance system, with mortgages backed by Ginnie Mae, could help move the debate forward:

"Ginnie Mae will not be the solution to the nation's housing market reform as long as the Housing Secretary or FHA's commissioner can set mortgage insurance premium rates through politics instead of math. We saw that with Shaun Donovan and Julian Castro but it remains to be seen at the next crisis whether Ben Carson will rule by partisan politics or actuarial science."

Related: How Ginnie Mae could break stalemate on GSE reform
Federal Reserve building in Washington, D.C.
The Marriner S. Eccles Federal Reserve building stands in Washington, D.C., U.S., on Tuesday, Oct. 23, 2012. Federal Reserve Chairman Ben S. Bernanke, who is seeking to spur the economy with a third round of so-called quantitative easing, has said his stimulus works by lowering borrowing costs and encouraging investors to seek higher-yielding assets. Photographer: Andrew Harrer/Bloomberg
Another response to a bipartisan plan to overhaul the housing finance market:

"Before you shut them down, first try and see what happens when you instruct the Federal Reserve to stop buying and reinvesting in virtually all their product. This proposal is uninformed on market forces."

Related: How Ginnie Mae could break stalemate on GSE reform
US Bancorp branch in Illinois.
An American flag flies next to signage outside a US Bancorp branch in Normal, Illinois, U.S., on Monday, July 10, 2017. US Bancorp is scheduled to release earnings figures on July 19. Photographer: Daniel Acker/Bloomberg
On an argument that a new small-dollar installment program from U.S. Bank could open the door for other lenders:

"This is an idea which sounds good but the devil is in the details. My suspicion is that many potential small, short-term loan customers have credit and/or negative account histories which make them historically non-bankable. Banks will be forced to loosen standards, adding risk. Loans will likely be unprofitable at any acceptable rate because of the small size, operational costs and credit risk. If credit qualified, an existing product (a credit card) will solve the problem."

Related: Momentum is building for small-dollar loans
Mobile banking concept
double exposure of Businessman hand using mobile phone with social network diagram on wooden desk as concept
On a community bank partnering with a fintech to offer a subscription service for mobile banking:

"Subscription? It's also know as a 'monthly maintenance fee,' and it's been around for decades."

Related: Can a subscription model work with mobile banking?
Victoria Finkle
BankThink Editor , American Banker
Fintech regulations Fintech GSE reform GSEs Jeb Hensarling Ginnie Mae
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