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US small town banks are prodding regulators to get tough on “fintech” companies, in a move that betrays traditional lenders’ fears of the young upstarts taking their business.
In a no-holds-barred letter to bank regulators, Independent Community Bankers of America, a trade group for more than 6,000 small banks, raised questions over the solidity of some fintech businesses and called for them to be fully regulated.
“ICBA believes that the recent problems that some of the online marketplace lenders have experienced with liquidity and earnings, as well as with compliance, makes it important that these lenders be subject to safety and soundness supervision and regulation,” wrote Karen Thomas, senior executive vice-president at the trade group.
It is unusual for a corporate lobby group in Washington to urge tighter regulation of another industry because business groups typically unite in opposition to perceived red tape imposed by the Obama administration. [...]
Full article on Financial Times (subscription required)