OCC’s Fintech Charter May Soon Have Its First Applicant
According to Politico, the Office of the Comptroller of the Currency (OCC) and Avant, an online lender, are in high-level discussions regarding the federal agency’s fintech charter. Barring any mishaps, Avant is likely to be the first company to apply for the special-purpose bank charter.
The OCC announced last July that it would move forward with national fintech charters. “The decision to consider applications for special purpose national bank charters from innovative companies helps provide more choices to consumers and businesses, and creates greater opportunity for companies that want to provide banking services in America,” said Joseph M. Otting, the Comptroller of the Currency. “Companies that provide banking services in innovative ways deserve the opportunity to pursue that business on a national scale as a federally chartered, regulated bank.”
Since the announcement, the OCC has faced several lawsuits over its fintech charter. New York’s Department of Financial Services (DFS) and the Conference of State Bank Supervisors (CSBS) each filed lawsuits against the OCC seeking to block implementation of the charter. Both cases are ongoing.
Avant has several banking relationships, including with HSBC and Regions Financial, and has recently reached a settlement with the Federal Trade Commission (FTC). The FTC claimed Avant had engaged in deceptive and unfair loan servicing practices.
After the settlement, Avant CEO Al Goldstein stated, “We’ve recently executed a mutually agreeable resolution to this matter … Our focus and commitment have always been on providing our customers with transparent and complete information that helps them make smart financial choices and borrow money responsibly.”