(29 July 2024 – United States) US banking regulators have issued a warning about risks with third-party deposit arrangements and are seeking more information on bank-fintech relationships.
The Federal Reserve, FDIC, and Office of the Comptroller of the Currency are asking for input on various bank-fintech arrangements, including deposits, payments, and lending products.
The agencies are “seeking input on the nature and implications of bank-fintech arrangements and effective risk management practices,” as they ponder further steps.
Separately, the regulators note that some banks have teamed up with third parties to deliver deposit products and services, such as checking and savings accounts.
“A bank’s use of third parties to perform certain activities does not diminish its responsibility to comply with all applicable laws and regulations,” warn the regulators.
Such arrangements pose risks, such reducing control, a lack of access to records, compliance issues at the third party, and insufficient risk management for consumer protection.
Although it does not set out new expectations, the statement reminds lenders of the existing legal requirements, guidance, and related resources.