Its the end of the world as we know it whether we realize it or not.
On Friday, The OCC announced that it had the power to grant bank charters to financial technology companies and was going to use it. Specifically, it explained that fintechs could apply to operate “special purpose” banks.
It laid out the case for its legal authority but invited the public to comment on the issues involved as it moves forward. Needless to say, the CU industry should weigh-in.
How big a deal is this? Time will tell but think of it this way: When Apple introduced Apple Pay it had to partner with banks and credit unions that were willing to use its technology to facilitate payment transactions. Now, with the OCC moving forward with its plans, the Apples of the world can simply become special purpose banks so long as they engage in at least one of three “core activities” receiving deposits, paying checks, or lending. 12 C.F.R. § 5.20.continue reading »