National Bank Charters Will Be Available for Fintech Companies, Comptroller of the Currency Says at IIEL Event

December 9, 2016

The Office of the Comptroller (OCC) will move forward with plans to make special-purpose national charters available to financial technology companies offering bank products and services, Comptroller of the Currency Thomas J. Curry announced at the Law Center on December 2.

Curry’s remarks, hosted by Georgetown Law’s Institute of International Economic Law, were followed by a conversation between Curry and the Institute’s faculty director, Professor Chris Brummer, regarding the details of the plan — including how many institutions might be involved and how they might be evaluated as well as questions of flexibility, cybersecurity, capital requirements, consumer protection and more. The announcement followed the release of an OCC publication outlining the relevant issues and seeking comments from interested parties.

“A little bit of regulatory history is going to be made today at Georgetown,” Brummer said.

Why take this important step? “Fintech companies hold great potential to expand financial inclusion, empower consumers, and help families and businesses take more control over their financial matters…” Curry said. “Providing a national charter to those responsible innovators who seek one…can help promote economic growth across the country — and recognizes that technology-based products and services are the future of banking and the economy.”

Having clear standards for fintechs to become national banks ensures that regulators and companies openly vet risks, the Comptroller said. “It will be much better for the health of the federal banking system and everyone who relies on those institutions, if these companies enter the system through a clearly marked front gate, rather than through some back door,” he noted.

Georgetown Law Dean William M. Treanor, who introduced the event, said that the discussion highlighted the evolving nature of finance and financial technology. “Financial innovation is changing the way banks and other firms do business,” he said. “At the same time, it challenges the way regulators oversee banks and the markets they operate in, their interaction with consumers and the stability of the financial system.”