Expectations are high that the Trump Administration will support financial innovation and entrepreneurship. Many Fintechs are elated with his election, as it contrasts to the difficult environment during the Biden Administration. The Financial Technology Association (FTA) has published a “Fintech Policy Roadmap” that the administration hopes to pursue in its first 100 days.
The FTA is a group that represents many large Fintechs, including payments, banking, and more. The FTA roadmap includes the following:
- Appoint Innovation-Focused Leaders: Nominate regulators who understand the benefits of responsible innovation and are willing to engage in collaborative policymaking.
- Modernize Payments Infrastructure: Grant non-bank companies access to the national payments system and establish an optional federal payments charter.
- Curb Regulatory Overreach: Reassess rules that impede innovation in payments, buy now pay later, earned wage access, brokered deposits, fraud prevention, and the use of AI.
- Strengthen Bank-Fintech Collaboration: Provide regulatory clarity that encourages partnerships between banks and fintechs, ensuring equitable access to financial services.
- Empower Consumers Through Open Banking: Safeguard consumers’ rights to access and control their financial data in secure, user-friendly ways.
- Combat Financial Fraud and Scams: Implement a national strategy to protect consumers from increasingly sophisticated financial threats.
- Advance AI Governance in Finance: Refine frameworks for the responsible use of AI in financial services, ensuring transparency while expanding accessibility and effectiveness.
- Support Small Business Growth: Simplify processes for small businesses to start, scale, secure funding, and integrate innovative technologies to drive success.
- Increase Investor Access: Modernize the definition of an accredited investor and encourage healthy, robust, and accessible markets that help Americans build wealth and save for retirement.
The list is pretty broad and includes access to capital which would include online capital formation.
FTA President and CEO Penny Lee says many current laws and regulations are anchored in the analog past.
“Modernizing these laws can enhance access, affordability, and security in financial services while ensuring America remains a global leader in Fintech.”
Lee says her group is “ready to work with the new Administration and Congress” to help craft Fintech-friendly policy.
During the last administration, the House, under Republican leadership, approved many bills that were supportive of Fintech, which helped both consumers and smaller firms. Unfortunately, the Democrat-controlled Senate became the place where good legislation died. This will change as the Republicans step in and garner the majority. Hopefully, they will not squander the opportunity.