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Many have believed that the national bank “fintech charter” is an ideal solution to providing marketplace consumer loans on a 50-state basis. A recent ruling from the Southern District of New York casts significant doubt on the viability of obtaining such a charter, at least in the near term.
In December 2016, the Office of the Comptroller of the Currency (“OCC”) announced its intention to consider the chartering of special purpose national banks to financial technology companies that provide banking products and services. Under the proposal, such “fintech charter” banks would not be required to operate as full service national banks and, importantly, would not be required to accept deposits, as long as they engage in activities considered by the OCC to be core activities within the “business of banking,” such as lending and payment processing.