The Federal Deposit Insurance Corporation (FDIC) has ramped up its tracking of fintechs partnering with banks to identify potential issues early. This new system, implemented after the bankruptcy of an American banking as a service (BaaS) company, allows FDIC examiners to monitor fintechs even if they switch banking partners. This initiative aims to enhance existing bank oversight and ensure financial safety and compliance.

Key points:

• Enhanced Tracking: FDIC now closely monitors fintech-bank partnerships
• Regulatory Focus: Attention on Know Your Client (KYC), compliance, risk management and fraud
• Proposed Rules: Strengthening recordkeeping and redefining brokered deposits

FDIC Chairman Martin J. Gruenberg emphasized the importance of these measures to protect depositors and maintain financial stability.