U.S. banking regulators have warned about the potential risks associated with third-party deposit arrangements and called for more information about relationships between lenders and fintechs.
In a joint statement, the Federal Reserve, the FDIC and the Office of the Comptroller of the Currency released a Information request in a wide range of bank fintech arrangements, including in relation to deposit, payment and lending products and services.
The agencies are “seeking information on the nature and impact of bank-fintech arrangements and effective risk management practices” as they consider next steps.
Separately, regulators note that some banks have worked with third parties to offer deposit products and services such as checking and savings accounts.
“The use of third parties to carry out certain activities does not diminish a bank’s responsibility to comply with all applicable laws and regulations,” warn regulators.
Such arrangements involve risks such as reduced control, lack of access to records, third-party compliance issues and inadequate risk management to protect consumers.
Although it doesn’t raise new expectations, that is opinion Reminds lenders of existing legal requirements, guidance and related resources.