Fintech Takes: Regulatory Roulette on Capital Hill

10 snips

Feb 26, 2025

Rob Blackwell, Chief Content Officer at Intrafy and former American Banker editor, shares insights on the turbulent world of banking regulation. He discusses the potential weakening of the CFPB amidst political pressures and the importance of regulatory oversight for fintech partnerships. The conversation highlights the FDIC's push for tailored supervision without sacrificing scrutiny, and the OCC's new leadership fostering cooperation. Blackwell underscores the crucial role of community banks in local economies and the challenges posed by evolving regulations.

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INSIGHT

CFPB Factions

Two factions exist within the Republican party regarding the CFPB.
One wants to shut it down, the other to repurpose it for their agenda.

INSIGHT

Short-Term CFPB Winners

Big banks and big tech benefit short-term from a weakened CFPB.
Long-term, this advantage is limited, as other regulators and future administrations can still pursue actions.

ANECDOTE

Crypto Industry vs CFPB

Elon Musk tweeted "CFPB RIP", signaling support for shutting down the CFPB.
Brian Armstrong of Coinbase also advocated for the CFPB's elimination, highlighting the crypto industry's potential benefit.

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Welcome to Fintech Takes! I’m Alex Johnson, and today we’re heading straight into the belly of the beast—Washington, D.C.—where regulators, banks, and fintechs are jockeying for position. Joining me is Rob Blackwell, a 20-year American Banker veteran, Intrafi’s Chief Content Officer, and host of the Banking with Interest pod.

Today, we're diving into the big four: CFPB, OCC, FDIC, and the Fed. Regulatory shifts are moving fast, so by the time this airs, this could all be outdated—but hey, c’est la vie!

First up, the push to gut the CFPB is gaining ground in some circles, but even banks and credit unions see value in maintaining a referee. Will the CFPB be sidelined (to, ahem, crypto’s benefit) or bounce back with a vengeance? Rob’s take is that it’ll be weakened, not wiped out—it’s too useful politically.

Next, the FDIC's tailored supervision shouldn’t mean loosening oversight, especially where fintech partnerships are involved. Small banks aren’t JPMorgan, but they still need scrutiny. Same goes for the OCC, where new leadership is prioritizing collaboration with banks while pushing for targeted regulation to keep things fair. No wild cards here; Trump’s picks are pragmatic, not radical.

Finally, the FDIC and Fed are pushing for clearer rules and more transparency, aiming to rein in overreach without forcing banks into unwanted partnerships. The challenge: giving banks discretion while preventing regulators from nudging them into silent exclusions.

Bottom line? The rules are changing, but power plays never do.

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