Fintech regulations

A week after the Treasury Department laid out a plan for federal fintech regulation, it is already unclear which agency is leading the charge.

Earlier this year, the Central Bank of Ireland announced plans to launch a fintech innovation hub, with the intention of engaging with all firms that are delivering innovation across the financial services sector, says Billy Hanley, senior development adviser for Enterprise Ireland.

The bureau announced the creation of the Global Financial Innovation Network for regulators to discuss joint policy work and offer a cross-border product testing process.

The agency’s decision to offer special-purpose charters for fintech companies raises questions about how those institutions will be overseen and the risks they could pose to the system.

The bureau wants to encourage more innovation without the threat of enforcement, but observers say regulators also need a testing ground to prove they can regulate fintech.

The administration’s recent report on fintech innovation discussed ways to adopt electronic promissory notes — or eNotes — and automated appraisals in federal mortgage programs.

The OCC has simplified language detailing how fintech charter applicants will clear requirements for meeting community needs. The move has some consumer groups worried.

Fintech firms have the federal option they have long sought, but meeting the agency’s application requirements will not be easy.

Treasury, OCC want to make it easier to compete with banks; the two banks will sell notes and other products through a broker network.

The decision, unveiled just hours after the Treasury Department endorsed the charter concept, means some fintech firms could soon be regulated more like banks.