WASHINGTON–With both credit union trade groups pressing Congress to bring fintechs under the same regulatory umbrella as other financial institutions, one of the key questions to be asking is what happens when things go wrong, according to NAFCU.
Credit union trade groups have called on Congress to ensure a “level playing field” between unregulated fintechs and credit unions. A number of fintechs have in the last year seen strong user growth into the millions of customers. Congress held a hearing on the issue last week.
“What we saw from the hearing is there are still a lot of questions,” said NAFCU EVP and General Counsel Carrie Hunt. “We are going to see more hearings on this issue. I think, ultimately, there is going to be a lot of disagreement as to what that regulation should look like. There is agreement that traditional financial providers can find value in partners, including fintechs, which can innovate quickly. It’s when they go one step further that begs the question around safety and soundness. We think credit unions provide the best option for consumers cradle to grave. These apps to move cash around quickly have a very finite purpose. The consumer really likes them until there is a problem, such as fraud, and then they end up going back to their credit unions. This is about a fair playing field.”
Regulatory Rollbacks’
Separately, the Biden Administration continues to roll back a number of Trump Administration rules and regulations, most recently around fair housing
Hunt said NAFCU is watching the moves being made by the Biden Administration, as it strongly supports a “deregulatory agenda.”
“If there is re-regulation, we want it to be necessary regulation,” said Hunt. “That’s how we view these rollbacks. We strongly support fair housing. Generally, it’s not the intent of regulation we have an issue with, its regulatory burden and whether it’s necessary to achieve those goals. Generally, there are other ways to achieve those goals.”
With over 50 years of experience in the credit union sector, I have had the privilege of observing and participating in its evolution from various vantage points. My journey has taken me from serving as a dedicated volunteer holding critical leadership roles, including serving on the supervisory committee, as director, and as board chairman, culminating in my tenure as CEO for 12 years and now founder and President/CEO of the National Council of Firefighter Credit Unions . This extensive background has enabled me to " Sit On Both Sides Of The Desk ," blending operational expertise with strategic oversight. In this blog post, I want to share how this dual perspective has enriched my understanding of credit union dynamics and fostered more effective governance. By leveraging the insights gained from years spent navigating both the intricacies of daily operations and the broader strategic objectives, I have witnessed firsthand the transformative power of collaboration, communi...
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