Julie Clover
The US Consumer Financial Protection Bureau (CFPB) today proposed new oversight requirements for technology companies like Apple that offer digital wallets and payment apps.
Payment services like Apple Pay are growing in popularity, but the companies behind them are not subject to the same “supervisory checks” that banks undergo, according to the CFPB . .
The new proposed rule would require companies that process more than five million transactions a year to adhere to the same rules as large banks, credit unions and other financial institutions supervised by the CFPB.
The new proposed rule would require companies that process more than five million transactions a year to adhere to the same rules as large banks, credit unions and other financial institutions supervised by the CFPB.
The new proposed rule would require companies that process more than five million transactions a year to adhere to the same rules as large banks, credit unions and other financial institutions supervised by the CFPB.
The new proposed rule would require companies that process more than five million transactions a year are subject to the same rules as large banks, credit unions and other financial institutions regulated by the CFPB. p>
The CFPB says there are a growing number of complaints against technology companies in the consumer lending market and argues that examiners should be able to scrutinize technology companies to ensure they are following the law.
Major technology companies and others in consumer finance markets are blurring the traditional lines separating banking and payments from commerce. The CFPB found that such dilution can put consumers at risk, especially when traditional bank protections such as deposit insurance may not apply.
Despite their impact on consumer finance, big tech and other nonbank companies operate in The payments industry is not subject to the same regulatory scrutiny and oversight as banks and credit unions. Although the CFPB has enforcement authority over these companies, many of these firms did not previously have CFPB examiners to scrutinize their activities to ensure they were complying with the law and to monitor their executives.
The CFPB wants to be able to audit tech companies to make sure they comply with funds transfer, privacy and consumer protection laws, and adhere to the same rules banks must follow. If finalized, the proposed rule would give the Consumer Financial Protection Bureau greater control over financial services provided by companies such as Apple and Google.
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