WASHINGTON — The Office of the Comptroller of the Currency faces a challenging task as it attempts to add financial inclusion requirements to its pending fintech charter without following the exact blueprint of the Community Reinvestment Act.

Consumer groups and industry observers acknowledge that in the era of digital banking, the 1977 law needs an overhaul. But figuring out how best to apply its spirit to these new products is easier said than done.

"CRA is very obsolete," said Jo Ann Barefoot, a consultant to both fintech companies and government agencies. "Pretty much everyone appreciates that."

In a paper issued Friday, the OCC outlined its authority for granting limited charters to fintech companies, laying out some of the criteria it would use to evaluate applications, including capital and liquidity requirements — and compliance with the goals of the CRA.

"Because there are tremendous benefits that financial institutions have been able to make in the communities that they serve through the CRA, we would like to see those same opportunities from innovation benefit communities," Grovetta Gardineer, the OCC's senior deputy comptroller for compliance and community affairs, said in an interview.

The OCC acknowledged that the CRA would not apply to most fintech companies eligible for the new charter, because institutions that do not take deposits and do not receive depository insurance from the Federal Deposit Insurance Corp. are not subject to the law.

Yet the agency asked applicants to submit a financial inclusion plan that would identify their market; describe the services offered and processes for marketing and delivery; and explain how these would promote financial inclusion.

Fintech companies will have "to show how the product and service that they are going to provide will not only be implemented in a safe and sound matter, but how it would meet the needs of the communities they are trying to reach," Gardineer said. "If you're going to serve communities and consumers, financial inclusion, fair access and fair treatment are fundamental responsibilities."

It remains to be seen how fintech companies will adapt the CRA law — which measures compliance based on a bank's performance within a set neighborhood — to their business models.

Fintech companies that have expressed interest in the charter are awaiting more guidance on the financial inclusion plans, which the agency highlighted as a topic for public comment in its paper.

"Financial technology platforms enable widespread access to capital that transcends traditional 'assessment areas,' " said Sam Taussig, the head of government relations and community banking at the online lender Kabbage. "Unlike a bank with branches and ATMs, fintech companies present the unique issues of establishing a reference point to determine how financial inclusion is measured."

The geographic component of the law has been a thorn in the side of regulators and banks alike, as they have struggled to make it relevant to an industry that is fast migrating online.

"I am cautious about anchoring our expectations to a statute that is embedded in a brick-and-mortar model when that is not what we see today," Gardineer said.

Though Gardineer cautioned that financial inclusion plans would vary significantly depending on the applicant's business model — which could range from a payments company to an online lender and even potentially a virtual currency firm — she said companies could leverage their data to analyze how inclusively the products are being offered.

"This is really all about financial inclusion, and innovators will have a lot of data," Gardineer said. "Perhaps they could look at census data," she added, or their own marketing concentration data.

The OCC has also suggested it could use the fintech chartering process to experiment with new models for CRA compliance — though changing the regulation itself would be a multiagency process involving the FDIC and the Federal Reserve.

"If something came about through our approach to financial inclusion which I could share with my colleagues that could also work to enhance the effectiveness of CRA, I would absolutely share that with them," Gardineer said.

But some are skeptical that the OCC will be able to use the charter as a platform for experimentation on these matters.

"Time is money," said John Beaty, a partner at Venable. "Applicants are going to say it's more important to me to get approval quickly than it is to find the least burdensome approach to solve this issue."

In fact, applicants may find it more practical to model their financial inclusion plan on a traditional bank CRA plan, despite the additional costs that might entail.

The CRA has "been worked on a lot by the agencies and there are fairly well-articulated expectations embedded by the guidance that's been given out by the agencies," Beaty said. "The pragmatic approach for some fintech companies will be to simply try to get as close to CRA as they can."

If the OCC takes inspiration from the CRA, it could look to the strategic plan option, which allows financial institutions to develop tailored plans to fit their business models, in exchange for some additional restrictions.

"That is a potential model for what the OCC may be looking for in its financial inclusion element because it's a customized approach to expanding providing financial products and services," said Julie Williams, a managing director at Promontory and former top OCC official.

Internet banks that have had to comply with the CRA to obtain national charters could also set a precedent.

"There are multiple tests to assess how an internet bank meets the needs of the CRA," said Cliff Stanford, who chairs Alston & Bird's bank regulatory group. Some are "designed to allow some rule for credit towards the CRA towards [institutions] that don't have banks all over the place."

The OCC said it would ensure the companies reach underserved communities through the chartering approval process — which will require a greenlighting of the company's financial inclusion plan — and through supervision.

"As a part of our examination process we will be checking to see if certain milestones that have been imposed through the licensing process are being met" within the timeframe given, Gardineer said.

"If the conditions are not being met, then these things can be escalated through either formal or informal enforcement actions," she added.

Those could include "matters requiring attention" memos to a company's top management and board, formal enforcement actions or civil money penalties.

The OCC also argued that the weight of responsibilities that come with obtaining a national bank charter and being federally regulated would keep fintech firms in line. And beyond the CRA, fintech companies under the charter would be covered by both state and federal fair lending laws.

"The obligations and the consistency and the regularity with which we go in for compliance is understood," Gardineer said.

But consumer advocates say they are not convinced that the OCC will regulate nationally chartered fintech companies more effectively than the states.

Kevin Stein, associate director at the California Reinvestment Coalition, pointed to the recent actions against Wells Fargo after Wells employees created more than 2 million bogus accounts over a period of five years.

In September the OCC, the Consumer Financial Protection Bureau and the city of Los Angeles fined the bank $190 million in penalties and restitution for the widespread fraudulent practices.

"There are bad actors out there, and they're doing harm," Stein said. "Is the OCC equipped to deal with a new charter?"

Some consumer groups aired long-held suspicions that the OCC will not be strict enough in enforcing any CRA-like standards.

"We want there to be requirements to ensure that it's strong," said Michelle Sternthal, the deputy director of policy and governments affairs at Main Street Alliance. "Strong requirements so that the loans and service in the areas for small businesses are adequate."

Incentives for compliance will also have to be adapted to the new business models, she added.

"Under current CRA practice, a bank that fails to meet their examination will get a poor score, and that can affect their mergers and acquisitions," Sternthal said. "It would be important for any CRA-like requirement to have quite robust enforcement mechanisms."

The OCC's Gardineer pointed to its approval of the CIT-OneWest merger as an example of how it might enforce financial inclusion requirements through the charter.

After holding a public hearing, the OCC conditionally approved the merger in July 2015, asking the bank to revise its CRA plan.

As a condition for the merger, "We actually required the institution to develop a Community Reinvestment Act plan" based on input from local community groups, Gardineer said.

In May, the agency approved the updated plan — but that did not sit well with consumer groups.

"The regulators' handling of this merger ultimately fails to live up to the stated goals and spirit of the Community Reinvestment Act," Paulina Gonzalez of the California Reinvestment Coalition and John Taylor of the National Community Reinvestment Coalition wrote in a June op-ed for American Banker. The decision, they added, "damages the trust communities and advocates have in the regulators who are supposed to enforce it."