By Katanga Johnson
WASHINGTON (Reuters) – A federal banking regulator on Tuesday finalized new rules that should make it easier for non-bank companies to acquire a banking license, paving the way for a slew of technology companies to compete more effectively with traditional banks.
The rule, issued by the Federal Deposit Insurance Corporation (FDIC,) offers special consideration in allowing non-banks to accept deposits and engage in other limited banking activities. The parent companies of the lenders must maintain significantly higher capital than other insured banks and enter an agreement on capital and liquidity maintenance, consent to FDIC examinations and annual external audits, and agree to record-keeping requirements, among other standards, the regulator said.
The rule, which was adopted after the agency sought public input in its March 2020 proposal, affects new “industrial loan charter” (ILC) banks, which are lenders chartered by states. …
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