The Conference of State Bank Supervisors (CSBS) has released a new programme whereby payment firms can complete one compliance examination and be regulated across more than 40 states.
These streamlined state examinations will now enable payment firms to complete a single exam, beginning in 2021, that will satisfy all state examination requirements. A report from Reuters claims the regulation was accepted by 48 states.
The MSB Networked Supervision will apply to 78 of the US’s biggest payments and cryptocurrency companies that currently meet the 40-state threshold.
This streamlined exam process will enable states to fine tune a risk-based approach to each company’s operations and when compliance issues arise, the states will be better suited to follow up, the CSBS said.
Kevin Hagler, Georgia Department of Banking and Finance commissioner and CSBS Board chair, said, “MSB Networked Supervision is a significant and important shift in how state regulators will ensure compliance with consumer protection and safety and soundness standards for the largest payments companies. By working together and relying on the excellent work of fellow state regulators, we will be able to do even more.”
Transmitter Regulators Association Board president Rick St Onge said, “This announcement represents years of work by state agencies to move networked supervision forward. The next stage will be equally important as we raise the bar for multistate exam coordination.
“For over a century, state regulators have responded to evolutions within the money transmission industry, and networked supervision is the logical next step to more effectively and more efficiently supervise the growing number of nationally operating companies.”
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