Fintech companies can now apply for a national bank charter

If granted a charter, the company would be supervised like similarly situated national banks

Fintech companies can now apply for a national bank charter

Non-depository financial technology companies engaged in the business of banking can now apply for national bank charters, the Office of the Comptroller of the Currency (OCC) has announced.

The OCC said its decision to accept applications from fintechs is consistent with bipartisan government efforts at federal and state levels to promote economic opportunity and support innovation.

The agency stressed that it will evaluate each application on its unique facts and circumstances.

If a fintech company receives a special-purpose national bank charter, it will become subject to capital, liquidity, and financial inclusion commitments and will be supervised like similarly situated national banks.

A charter also brings an expectation that a company would submit a contingency plan in case significant financial stress threatens the viability of the bank. Fintech companies that become special-purpose national banks will be subject to heightened supervision initially, similar to other de novo banks.

In the event that the company fails, the OCC said it has the authority to unwind the company.

“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. 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,” Comptroller of the Currency Joseph Otting said.