For financial institutions in today’s rapidly changing market, remaining on top of trends in products and services can be the difference between growing effectively and losing customers to competition. Partnering with fintech companies may expand product availability, increase revenues and decrease expenses, furnish expertise, and assist the financial institution in meeting strategic goals. But, as with all third-party partnerships, the use of fintechs does not diminish the responsibility of an institution’s board of directors and management to ensure that fintechs operate in a safe and sound manner and in compliance with applicable laws, regulations, and internal policies.
On Aug. 27, 2021, the federal bank regulatory agencies (Federal Reserve Board (FRB), Federal Deposit Insurance Corporation (FDIC), and the Office of the Comptroller of the Currency (OCC)) released “Conducting Due Diligence on Financial Technology Companies: A Guide for Community Banks” (The Guide). The Guide is intended to assist community banks with assessing the risks and benefits as part of a financial institution’s due diligence process.
For a look at the guide and what it means for financial institutions, download our latest whitepaper.