A slew of formal applications for special-purpose national bank charters may be coming soon, according to the head of the agency in charge of processing and approving the applications.
Joseph Otting, the head of the Office of the Comptroller of the Currency, told reporters that "a number of entities" are close to completing the preliminary application, which companies file with the OCC before formally filing an application.
In late July 2018, the agency opened its doors for nondepository fintech companies to become federally regulated. Since then, companies have been working with regulators to complete the preliminary application process. Former Comptroller Thomas Curry attributed the lack of applications to a lengthy approval process but expects many companies are interested in pursuing the charter. Otting said that costs associated with the applications could reach as high as $500,000.
However, New York and other state regulators have filed lawsuits against the agency for an overreach of power by the federal government in regulating smaller entities. Otting reiterated previous comments that he supports the dual national and state regulatory system.
"I don't understand why they want to limit consumers' access to products, because in my mind, I support the dual banking system," he said. "My viewpoint is [that] 2019 will be a pretty interesting year to watch fintechs."