Policy Priorities
Responsible financial institutions offering embedded finance or Banking-as-a-Service keep banks competitive
and empower consumers with financial options
“The problem with check-the-box supervision is that there are a lot of boxes to check, and each box is given equal weight. This ensures comprehensiveness, but artificially limits our ability where it is needed most.”
Michael Hsu, Acting Comptroller of the Currency
Remarks Before the Joint European Banking Authority and European Central Bank International Conference, September 3, 2024
Whether we call it BaaS, embedded banking, or by another moniker, it is part of the evolution and extension of financial services to meet the expectations of today's businesses and consumers; it is a disruptive delivery channel, no different than credit cards is to checks or the ATM is to a branch.
Regulatory clarity and certainty is key. Regulated and responsible financial institutions recognize their role to protect the integrity of the financial system and are poised to lead the future of financial services innovation as they break down traditional barriers to capital and reach families and businesses traditionally left behind. Responsible innovators require regulatory modernization that promotes innovation but also holds innovators accountable to being open and transparent. We are now at a moment where modern and forward-looking regulation will strengthen the banks and fintech companies that play by the rules and act responsibly.
Our collective goal should be ensuring the transparency that underpins the trust in our current banking system evolves to meet our clients' expectations by defining the rules, versus turning away from them.
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