The Financial Technology Association (FTA) has distributed an update on their policy position alongside Small Business Week.
According to the FTA, the following are its top priorities regarding legislation that impacts Fintechs and smaller firms.
- Help Businesses Start: New businesses must navigate complex compliance and filing requirements across the country. Policymakers should modernize filing requirements to allow businesses to submit paperwork, such as 83(b) elections, online rather than requiring them to send it by paper or fax.
- Help Businesses Access Capital: Fintechs play a crucial role in expanding access to capital, filling gaps for small businesses that are traditionally underserved by financial institutions. Policymakers should consider a uniform, model state commercial financing disclosure law that harmonizes differing state requirements and accounts for various financing models, ensuring that small businesses can continue to make informed decisions. Additionally, as policymakers consider reopening the recent small business lending rule, this reporting requirement must strike a balance between fairness, understanding of small businesses’ credit needs, and the burdens of compliance.
- Help Businesses Scale: Fintech tools help small businesses grow and succeed. In particular, Fintech offerings can streamline retirement plan administration through technology and automation, reducing costs and complexity for small businesses seeking to attract talent and support employee financial security. Policymakers should help small businesses leverage such technological solutions by enhancing and expanding retirement plan startup tax credits. They should also help small businesses take advantage of emerging technologies, such as artificial intelligence.
- Help Businesses Get Paid: One of the biggest pain points for small businesses is managing cash flow and getting paid on time. Faster payments would enable businesses to settle expenses, pay employees, and purchase inventory more efficiently and in a more streamlined manner. Policymakers should prioritize payments modernization, including the creation of an optional federal payments charter for non-banks, which would help small businesses get paid faster.
Penny Lee, President and CEO of the FTA, says their agenda outlines commonsense moves to modernize financial policies and regulations:
“Small businesses are the engine of the economy, and access to innovative digital tools is critical to their success.”
