Comptroller of the Currency Thomas Curry on Thursday soundly rejected the possibility of creating a "safe space" for fintech firms to operate outside of consumer protection rules while they develop and test new products.
"I do not support this approach," Curry said in a speech in London. "Waiving compliance with consumer protection or safety and soundness never makes sense, nor does our agency have the authority to waive compliance requirements. … It is the company's responsibility to ensure products and processes are safe before rolling them out."
In his remarks, Curry also gave further signs of what a "pilot" program for fintech companies would look like.
"Companies can conduct carefully designed pilots responsibly and limit their liability by controlling scope and duration and ensuring their tests are closely monitored throughout," he said.
The comptroller encouraged any companies involved in experimenting with new products to talk to the OCC when launching pilot programs.
"Having an open dialogue with regulators in developing a pilot also helps by encouraging product and system designers to ask the right questions as they determine a product's features and the parameters of the test," Curry said.
Additionally, such a partnership "helps regulators understand precautions that companies have taken to ensure new products and processes are safe and sound and meet consumer protection standards," he said.
The OCC has made strides in recent months to address the growing fintech industry. Last week it announced that it would open an office dedicated to innovative products and companies operating in the financial sphere. The OCC is also preparing to release its determination on the question of whether to create a charter designed for fintech firms.
Curry promised more details on the potential fintech charter would come out "soon."
"It is clear that the OCC has the authority to issue a charter to companies that engage in at least one of three core banking functions — taking deposits, paying checks or lending money," he said. "And, it's clear that many fintechs perform these activities."
But Curry added that such a charter would not let fintechs off easy when it comes to regulatory compliance.
"If the OCC decides to grant a national charter in this area, the institution will be held to the same high standards of safety, soundness and fairness that other federally chartered institutions must meet," he said.
