Not sure what the implications of this are, but I’m passing it along for now.
he payment processor Square is seeking an industrial loan company charter, according to several sources familiar with the matter, further sparking debate over whether fintech companies should be allowed to use the controversial structure.
The company’s application, which is expected to be filed with regulators on Thursday, comes after the online lender SoFi applied in June for an ILC, a type of charter that allows companies to own a bank without having to comply with Bank Holding Company Act requirements and face supervision by the Federal Reserve Board. (Industrial loan companies are regulated by state regulators and the Federal Deposit Insurance Corp.)
Community banks and others who support a strong firewall between banks and commercial firms swiftly opposed Square’s move, expressing concern it could open the door to larger technology companies seeking the advantages of a bank charter without the same regulatory supervision.
Others are likely to support the move as a natural evolution for the banking industry, which has seen in recent years more fintech companies engaging in banking activities.
Guys, I’m down in Fort Lauderdale and we’re bracing for Irma pretty hard right now. Can’t leave because of my job. But might be offline for a bit depending on how bad everything gets/power outages/etc. For those on SE coast, stay safe and dry!
MasterCard (MA), PayPal (PYPL), Skechers (SKX) and Square (SQ) Ticker Guide
See all my holdings at http://my.fool.com/profile/CMFCochrane/info.aspx