“Fintech and cryptocurities consider obtaining banking licenses to expand business, reduce the cost of borrowing and increase legitimacy. Reuters writes about it. Companies study the conditions for compliance with the requirements of both the federal license and at the level of individual states. The initiatives are conditioned by the expectations of the change of regulators after Donald Trump’s victory in the US presidential election. Previously, the supervisory authorities issued permits slowly or reluctantly. […]”, – WRITE: Businessua.com.ua
Fintech and cryptocurities consider obtaining banking licenses to expand business, reduce the cost of borrowing and increase legitimacy. Reuters writes about it.
Companies study the conditions for compliance with the requirements of both the federal license and at the level of individual states.
The initiatives are conditioned by the expectations of the change of regulators after Donald Trump’s victory in the US presidential election. Previously, the supervisory authorities issued permits slowly or reluctantly.
“We see more interest and work on several applications. Our customers are set up restrained optimistic and wait for everything to settled [із затвердженням голів агентств]”,-said the partner of Troutman Pepper Locke Alexander Steinberg-Baradge.
According to two other unnamed sources, discussion and preparation of documents have been intensified, but it is unknown how many firms will make decisions.
Despite additional checks, the cost of capital and business can be reduced, and the license can give business more legitimacy and expand business opportunities, the publication said.
Hunton Andrews Kurtth Carteton Goss sees in the new status the possibility of reducing the cost of borrowing by attracting deposits.
New banks will increase competition and serve certain groups of customers or regions.
Earlier, the OCC issued the first since 2021 permission of Smartbiz’s Fintech Company to purchase the Centrust Bank with a federal license.
Changing the administration In the period from 2010 to 2023, agencies approved an average of five new applications annually, while in 2000-20-07 they were 144. The process could last and the documents were eventually recalled.
The number of applications has decreased due to low interest rates and burdensome rules. After the collapse of Synapse Financial Technologies, the department proposed to strengthen the rules for banks working with fintech companies, recalled in Reuters.
It is hoped that Trump will introduce a deregulation mode that will promote business growth, which can open a way for new licenses.
Recently appointed President of the supervisory authorities pledged to give priority to innovations and technologies, which is a positive signal for fintech and crypto companies.
Earlier, the FDIC Acting Chairman Travis Gill said the agency would encourage more companies to receive bank charters. Fed representative Michelle Bouman stressed the need to accelerate the process of approving new banks.
Calls Experts interviewed believe that increased control over the issuance of banking statutes is necessary for financial stability, but the process of consideration could be faster.
Two sources reported that the creation of a new bank requires from $ 20 million to $ 50 million. Access to capital and compliance with the laws on the fight against money laundering and bank secrecy are serious problems for companies that apply for charters.
Recall that in February, Trump was nominated by Jonathan Golda for the post of OCC leader at the US Ministry of Finance. According to Ron Hammond of Blockchain Association, the agency will simplify the creation of a regulatory framework for cryptocurrencies in the event of its candidacy.
The same month, the Federal Deputy Chairman of the Fed Michael Barr denied charges of crypto industry debaning in the United States.
Earlier, Vaoming Senantia Syntia Lammis threatened FDIC in criminal cases if the Office really destroyed the data associated with cryptonagliant.
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