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A group representing major tech companies, including Apple, Google, Amazon, Meta and X (formerly Twitter), has raised concerns over a proposed plan by the US Consumer Financial Protection Bureau (CFPB) to impose stricter supervision on companies offering digital wallets and payment apps.
According to a report by news agency Reuters, the group, called the Computer & Communications Industry Association (CCIA), argues that the plan could stifle innovation and limit market access for new players.
What is the proposal?
The CFPB’s proposal aims to subject these tech companies to the same level of supervision as traditional banks. This would involve agency examiners ensuring compliance with laws on consumer protection, privacy, and fair practices, as well as scrutinising executives’ behaviour. The proposal is still under review, and if implemented as it stands, would cover 17 companies responsible for processing 13 billion payments annually.
What the advocacy group has to say
The CCIA’s head of regulatory policy, Krisztian Katona, has warned that overly burdensome regulation could hinder startups in the industry. Katona reportedly stated that the proposal could do more harm than good.
In a comment letter reviewed by the publication, the CCIA criticised the CFPB’s proposal for failing to identify specific consumer risks and for unfairly viewing non-bank digital providers and banks as direct competitors.
The Financial Technology Association, another industry group representing companies such as PayPal and Block Inc, echoed the CCIA’s concerns in a separate letter. The association said that existing regulations were sufficient and called for the suspension of the rulemaking process.
According to a report by news agency Reuters, the group, called the Computer & Communications Industry Association (CCIA), argues that the plan could stifle innovation and limit market access for new players.
What is the proposal?
The CFPB’s proposal aims to subject these tech companies to the same level of supervision as traditional banks. This would involve agency examiners ensuring compliance with laws on consumer protection, privacy, and fair practices, as well as scrutinising executives’ behaviour. The proposal is still under review, and if implemented as it stands, would cover 17 companies responsible for processing 13 billion payments annually.
What the advocacy group has to say
The CCIA’s head of regulatory policy, Krisztian Katona, has warned that overly burdensome regulation could hinder startups in the industry. Katona reportedly stated that the proposal could do more harm than good.
In a comment letter reviewed by the publication, the CCIA criticised the CFPB’s proposal for failing to identify specific consumer risks and for unfairly viewing non-bank digital providers and banks as direct competitors.
The Financial Technology Association, another industry group representing companies such as PayPal and Block Inc, echoed the CCIA’s concerns in a separate letter. The association said that existing regulations were sufficient and called for the suspension of the rulemaking process.
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