Fintech Business Weekly

Fintech Business Weekly provides in-depth analysis on trends and developments within the fintech, banking, and regtech sectors, focusing on regulatory changes, legal challenges, market dynamics, technological innovations, and financial institutions' strategic responses to the evolving landscape of digital finance.

Regulatory Changes and Compliance Banking and Fintech Partnerships Legal Disputes in Fintech Financial Technology Innovations Market Trends and Funding in Fintech Consumer Protection and Financial Services Digital Banking and Payments Credit and Lending Practices Artificial Intelligence in Financial Services Data Privacy and Security

The hottest Substack posts of Fintech Business Weekly

And their main takeaways

CFPB Proposes Rule To Close TILA Overdraft "Loophole"

661 implied HN points • 21 Jan 24
💰 Finance Regulation Banking Investing Fintech Economics
  1. CFPB proposed a rule to close the TILA overdraft loophole, aiming to protect consumers from billions in junk fees.
  2. The proposed rule would require large banks to treat overdrafts like credit products, disclosing APRs and considering actual costs.
  3. Exempting banks under $10 billion in assets from the rule has sparked debate, highlighting the complexity of regulating banking fees.

Banking-as-a-Service: Wrapped

475 implied HN points • 31 Dec 23
💰 Finance Fintech Compliance
  1. The banking-as-a-service industry faced challenges in 2023, such as issues with compliance and partnerships.
  2. There was increased regulatory scrutiny on BaaS entities, with concerns around misleading claims and high interest rates.
  3. Multiple BaaS-related scandals and legal actions occurred throughout the year, impacting various companies in the industry.

CBW Bank, A BaaS Pioneer, Is Up For Sale: Exclusive

59 implied HN points • 17 Mar 24
💼 Business Fintech Banking Regulation Innovation Sales
  1. CBW Bank, a pioneer in Banking-as-a-Service, is up for sale, showing continued challenges in bank/fintech partnerships.
  2. CBW Bank grew significantly under new ownership, focusing on innovation and providing API access for startups and banks to build digital banking solutions faster.
  3. Regulatory shifts and challenges in innovation may have led to CBW's decision to sell, highlighting the impact of changing regulatory attitudes on banks like CBW.
Get a weekly roundup of the best Substack posts, by hacker news affinity:

Leaked Treasury Prime Docs Show Risks Of BaaS Business: Churn, Concentration, Slowing Growth

89 implied HN points • 03 Mar 24
💰 Finance Fintech Banking Regulations Business Models Risk management
  1. Leaked Treasury Prime documents highlight risks in Banking-as-a-Service business, including issues like churn, concentration, and slowing growth.
  2. Treasury Prime's strategic pivot to focus on selling to banks instead of fintechs resulted in drastic employee layoffs, shedding light on the challenging environment for middleware platforms in fintech.
  3. Fintech companies like Chime and Green Dot facing regulatory actions and penalties underscore the importance of compliance and customer service in the financial industry.

TabaPay Working On A Deal To Acquire Synapse, Sources Say

59 implied HN points • 10 Mar 24
💼 Business Fintech Venture Capital Startup Regulation
  1. TabaPay is in talks to acquire Synapse, a banking-as-a-service platform, to potentially mitigate damage caused by a past financial incident.
  2. Oxygen, a neobank, is pivoting to focus on 'health solutions' temporarily, suspending its banking services.
  3. Trade groups are suing to block a new CFPB rule that limits credit card late fees, arguing it restricts choices and responsible credit card use.

Is the Capital One/Discover Deal Good or Bad For “Competition”? Yes.

81 implied HN points • 25 Feb 24
💰 Finance Fintech Regulation Banking Acquisition Legislation
  1. Capital One's acquisition of Discover is a complex deal that has both good and bad elements for competition, creating a potential shake up in the US payments space.
  2. The CFPB is using once-dormant authority to supervise nonbank entities like World Acceptance Corp, focusing on risks to consumers.
  3. Acting Comptroller Hsu suggests creating a federal money transmitter licensing framework to better regulate non-bank companies providing bank-like services, highlighting potential risks in the growing role of non-bank firms in banking areas.

Consent Order Double Header Suggests Tough 2024 For Fintech, Banking-as-a-Service

141 implied HN points • 28 Jan 24
💼 Business Fintech Regulation Partnerships
  1. Fintech and media businesses are facing challenges like layoffs and closures, highlighting the importance of independent journalism.
  2. Regulatory changes like the CFPB proposed rules on junk fees and NY BNPL law are impacting the banking and fintech industry.
  3. Recent enforcement actions on Blue Ridge Bank and Choice Bank reveal the regulatory scrutiny on BaaS relationships, emphasizing the need for due diligence and compliance.

Morgan Stanley-Backed TomoCredit Isn't Paying Its Bills, Faces Mounting Legal Challenges

89 implied HN points • 18 Feb 24
💰 Finance Fintech Credit Legal Challenges Startups Banking
  1. TomoCredit, a startup backed by Morgan Stanley, is facing financial troubles and legal challenges despite its initial success claims.
  2. Mission Lane, a subprime card startup linked to LendUp, has raised $50 million and replaced its CEO in an effort to reposition itself.
  3. A study by the Federal Reserve reveals differences in how financially stable versus fragile households utilize buy now, pay later services, impacting the types and frequency of purchases made.

Potential Class Action Argues High APR "Rent-a-Bank" Scheme Violates RICO

96 implied HN points • 11 Feb 24
💰 Finance Banking Legal Regulation Fintech Lending
  1. A potential class action case argues against a "rent-a-bank" scheme for high APR loans, highlighting the importance of understanding financial regulations and usury laws in the lending industry.
  2. The case brings attention to the evolving landscape between fintech companies and traditional banks, showing the complexities and discussions around defining the true lender in partnerships.
  3. The case also underscores the need for transparency and clarity in financial partnerships, as demonstrated by the alleged lack of distinction between a fintech entity and bank in customer-facing materials.

Brigit's Good Intentions Aren't A Defense to FTC Allegations

156 implied HN points • 12 Nov 23
💼 Business Fintech Regulation Investment Financial Services
  1. Brigit faced FTC allegations despite good intentions in serving lower-income users
  2. FTC alleged deceptive practices by Brigit, including misleading claims and difficult subscription cancellations
  3. The Federal Reserve proposed lowering the debit interchange cap, expecting cost savings for merchants and potential impacts on fees and ecommerce

The Smallest Bank in Tennessee Grew Fast With BaaS. Why It May Give The Entire Industry A Hangover.

267 implied HN points • 27 Aug 23
💰 Finance Banking Fintech Regulation Partnerships Deposits
  1. The smallest bank in Tennessee saw significant growth by leveraging BaaS partnerships, but this rapid expansion may raise concerns about the bank's ability to manage increased complexity.
  2. The Herrington family behind Lineage Bank has a history of running banks, facing challenges and controversies in their previous ventures.
  3. Synapse, a key BaaS partner of Lineage Bank, has faced regulatory scrutiny and may be pressuring Lineage to approve more programs, highlighting risks in complex financial partnerships.

Blue Ridge "Explores Options" For Capital Raise As It Reduces BaaS, Fintech Exposure

126 implied HN points • 19 Nov 23
💰 Finance Banking Regulation Lending Payments Compliance
  1. Blue Ridge Bank is looking to raise capital and reduce its exposure to banking-as-a-service and fintech.
  2. States like California and Wisconsin are regulating earned wage access, which is positive but adds compliance challenges.
  3. Plaid has launched a subsidiary as a consumer reporting agency, moving towards offering cash flow underwriting services.

Future of Goldman's "Platform Solutions" Looks Grim

170 implied HN points • 24 Sep 23
💰 Finance Fintech Banking Cryptocurrency Regulation
  1. Eco shut down its banking app and laid off its team as it focuses on new money initiatives with cryptocurrency.
  2. Goldman Sachs is near selling GreenSky, indicating a bleak future for its "Platform Solutions" division.
  3. CFPB warns that lenders using AI must provide specific reasons for adverse actions and initiates rulemaking to remove medical debt from credit reports.

Was Fintech's Biggest Lending "Innovation" A Willingness To Serve Riskier Borrowers By Charging Higher Rates?

237 implied HN points • 09 Jul 23
💰 Finance Fintech Lending Venture Capital Banking
  1. Fintech lenders rely heavily on conventional credit scores like FICO and possibly overcharge riskier borrowers.
  2. Fintech's main 'innovation' is serving borrowers banks reject by charging higher interest rates.
  3. Goldman Sachs is looking to offload its Apple partnership, showcasing the shifting landscape of fintech engagements.

What Happened to the OCC's Chief Fintech Officer?

133 implied HN points • 10 Sep 23
💼 Business Fintech Banking Regulation Investment Startups
  1. The OCC's Chief Fintech Officer mysteriously disappeared from his role, raising questions about his background and qualifications.
  2. CFPB Director highlights Apple and Google's control over mobile payments, calling out potential anti-competitive practices.
  3. FDIC's Q2 Banking Profile shows declining net income, slightly reduced net interest margins, and continued unrealized losses in banks' securities portfolios.

Maryland Latest State To Issue EWA Guidance

126 implied HN points • 20 Aug 23
💰 Finance Fintech Bankruptcy Regulation
  1. Maryland issued guidance on earned wage access (EWA) products, following in the steps of Nevada and Missouri.
  2. CFPB Director Chopra announced new rulemaking to regulate data brokers and protect consumer data.
  3. Analysis of Dave's Q2 earnings shows discrepancies in metrics like average revenue per user, highlighting the importance of looking beyond official reports.

Breaking: Lineage Hit With FDIC Consent Order

2 HN points • 23 Feb 24
💰 Finance Banking Regulation Fintech Risk management Compliance
  1. Lineage Bank faced regulatory issues with the FDIC due to oversight failures in its banking-as-a-service partnerships.
  2. The consent order from the FDIC requires Lineage Bank to make significant changes in its management, risk assessment, and operational practices.
  3. The impact of Lineage Bank's BaaS wind down and the FDIC order on Synapse, Synctera, and their fintech clients is not yet clear.