The CFE Fund recently submitted a letter to the Federal Deposit Insurance Corporation, the Office of the Comptroller of the Currency, and the Federal Reserve Board in response to their request for information about Bank-FinTech partnerships. The letter highlighted our concerns about the importance of access to mainstream bank accounts and the significant safety risks associated with alternative FinTech provided products. We specifically highlighted the limited impact of increased transparency and education on the ability to understand differences between the mainstream and alternative products.
Category: Letter
CFE Comment Letter to National Association of State Workforce Agencies on Open UI Initiative
The CFE Fund recently submitted a comment letter to the National Association of State Workforce Agencies (NASWA) in response to their request for information on the Open Unemployment Insurance Initiative. Citing evidence from a range of CFE Fund work—including the success of our national Bank On initiative in assisting the Internal Revenue Service connect stimulus recipients to banking for direct deposit and our partnerships with the State of Illinois’s Department of Employment Security and the State of Maryland’s Division of Unemployment Insurance, incorporating access to safe and affordable banking accounts into the benefits application processes—the letter highlighted the importance of leveraging government payment systems to promote safe banking access.
CFE Fund Comment Letter to Treasury on Financial Institution Customer Identification Requirements
The CFE Fund recently submitted a letter to FinCen at the U.S. Department of Treasury in response to their request for information about updating the process of requiring full Social Security Numbers when opening a bank or credit union account. Drawing from our Bank On experience, our letter highlighted the barriers faced by consumers from marginalized communities from the current structure and application of customer identification requirements, the importance of financial institution acceptance of alternative forms of ID to facilitate banking access integrations and urged FinCEN to provide financial institutions with clear guidance on the acceptability of these alternative identifications.
CFE Fund Comment Letter to Consumer Financial Protection Bureau on Overdraft Lending Regulations
The CFE Fund recently submitted a comment letter to the Consumer Financial Protection Bureau (CFPB) in response to a Request for Comment on the CFPB’s proposal to update regulations that govern overdraft lending services. Citing evidence from the CFE Fund’s national Bank On initiative, the letter notes the role that overdraft fees play in breeding mistrust and destabilization, and points out the robust market of over 450 Bank On certified accounts across the country that do not allow overdraft, demonstrating the value of transparency and affordability in banking. This comment letter stresses the value of connecting safe and affordable credit options to basic transaction accounts like those certified through the Bank On National Account Standards, such as with overdraft lines of credit. It is critical that the un- and underbanked, a population overrepresented by people of color, can access transparent and safe short-term credit.
CFE Fund Comment Letter to Treasury on Financial Inclusion Strategy
The CFE Fund recently submitted a comment letter to the U.S. Department of Treasury Office of Consumer Policy in response to a Request for Information on developing a national strategy for financial inclusion. The letter cites evidence from the CFE Fund’s network of Financial Empowerment Center (FEC) municipal partners that demonstrates that access to mainstream banking accounts plays a pivotal role in people’s ability to save money, improve their credit scores, and build strong financial futures. The CFE Fund’s national Bank On movement has also highlighted the unique power of integrating banking access strategies into government service streams to address common access barriers like identification, language, and fees. In this letter, the CFE Fund urged Treasury to focus on large-scale government program and payment opportunities to connect unbanked Americans to mainstream banking, outlining a range of promising “bankable moments” related to federal programs.
CFE Fund Comment Letter on HUD Eviction Proposal
The CFE Fund recently submitted a comment letter to the U.S. Department of Housing and Urban Development in support of the proposal to provide tenants residing in public housing or receiving housing assistance with at least 30 days‘ notice before initiating formal eviction proceedings. The letter cites the success of a recent CFE Fund pilot focused on eviction prevention, which explored how Financial Empowerment Center (FEC) public counseling services could integrate and support existing emergency rental assistance and eviction prevention efforts. The pilot demonstrated that the period between notice of eviction and formal eviction proceedings is crucial to productive service coordination that benefits both tenants and landlords. The CFE Fund noted that our experience shows that additional time and space to coordinate comprehensive services such as rental assistance, legal aid, housing and financial counseling increases the likelihood that clients will seek them out and achieve positive outcomes and reduce the risk of eviction. Read the full letter here.
CFE Fund Comment Letter on Federal Reserve Proposal to Update Maximum Interchange Fees
The CFE Fund recently submitted a comment letter to the Board of Governors of the Federal Reserve System regarding their proposal to update the maximum interchange fees that can be charged by covered debit card issuers. The letter notes the CFE Fund’s learnings from our national Bank On initiative, which partners with financial institutions, community organizations, government leaders, and banking regulators to create pathways for un- and underbanked individuals to enter or reenter the financial mainstream with safe banking accounts; Bank On certified accounts have played a key role in programmatic banking access connections from local summer youth jobs programs to the U.S. government’s emergency pandemic relief funds. The fee limitations and features designated under the Bank On Standards were designed not just to meet consumer need but to be economically sustainable for financial institutions. The CFE Fund noted that our experience shows that interchange fees are a key part of that market sustainability. Read the full comment letter here.
CFE Fund Comment Letter on Statements on FDIC Advertising Rules
The CFE Fund recently submitted a comment letter to the Federal Deposit Insurance Corporation (FDIC) on the proposed changes to the rules governing the use of their official sign and statements about deposit insurance. The letter supports FDIC’s overall approach to ensuring that consumers understand when they are engaging a regulated financial institution and how the deposits are protected, and offers suggestions for effective implementation including a coordinated consumer awareness campaign and a robust compliance and enforcement strategy.
CFE Fund Comment Letter on Community Development Financial Institution Revisions
The CFE Fund recently submitted a comment letter to the U.S. Department of Treasury on the proposed revisions to the Community Development Financial Institution (CDFI) certification application. The letter is specifically supportive of the inclusion of an expanded question evaluating a financial institution applicant’s checking or share account features and its use of Bank On National Account Standards as a guide. It’s a clear recognition of the impact of the Bank On national movement and the critical importance of safe and affordable banking options to meeting the broader mission of the CDFI program.
CFE Fund Comment Letter on Community Reinvestment Act Reform
The CFE Fund recently submitted a comment letter to the Federal Reserve Board, Federal Deposit Insurance Corporation (FDIC), and Office of the Comptroller of the Currency (OCC) on their proposal to amend the regulations implementing the Community Reinvestment Act (CRA).
Citing experiences from the Bank On movement, as well as the FEC Public initiative, the CFE Fund supported the proposal for a new Retail Services and Products Test that would evaluate a bank’s branch availability, delivery systems, and the responsiveness of their products to the needs of low- and moderate-income communities; the CFE Fund also supported the highlighting of the Bank On National Account Standards as an example of a responsive deposit product. The CFE Fund suggested that the new Retail Services and Products Test 1) evaluates all large banks for the responsiveness of their deposit products; 2) enables “intermediate” sized banks to elect the Retail Services and Product Test; and 3) looks to the Federal Reserve Bank of St. Louis’ Bank On National Data Hub as an example of key metrics that examiners might use to assess financial institution account engagement.
Finally, the CFE Fund supported the agencies’ proposal to create a separate definition for activities that help individuals and families make informed decisions about managing income, savings, credit, and expenses that is distinct from other community development services, and suggested highlighting activities that produce measurable impacts such as banking access, credit score improvement, debt reduction, and savings increases.