​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​is issued by the Innovative Payments Association twenty times a year as a service to members.
Editors: Brian Tate, President and CEO, IPA; Ben Jackson, COO, IPA;  Eli Rosenberg, Partner, Baird Holm LLP; and Gray Derrick, Partner, Baird Holm LLP. Please address comments and suggestions to: gr@ipa.org.

Trump Supports CCCA and Capping Credit Card Interest Rates
U.S. Senator Roger Marshall (R-KS) has reintroduced the Credit Card Competition Act (CCCA).   CCCA is cosponsored by U.S. Richard Durbin (D-IL), the author of the Durbin Amendment. Initially introduced in 2022, CCCA, if enacted, would require that credit card transactions offer merchants a choice of networks beyond Visa and Mastercard.  President Trump has expressed his support for the bill.  It’s not clear at this time if the President’s endorsement alone is enough to garner support for the bill’s passage in the Senate or the House. 
 
House Subcommittee Holds Fintech Hearing
On January 13th the House Financial Services Committee, Digital Assets, Financial Technology, and Artificial Intelligence Subcommittee held a hearing entitled, “Delivering for American Consumers: A Review of FinTech Innovations and Regulations.”  Below highlight in blue is the testimony from the panelist for tomorrow’s hearing.  

• Ms. Jodie Kelley, Chief Executive Officer, Electronic Transactions Association
• Mr. Kevin Lefton, Global General Counsel, Stream
• Mr. Ram Palaniappan, Founder and Chief Executive Officer, EarnIn
• Mr. Todd Zywicki, Law Professor, George Mason University Antonin Scalia Law School 
• Ms. Delicia Reynolds Hand, Senior Director, Digital Marketplace, Consumer Reports

 
Kevin Lefton who testified on behalf of IPA member Stream, but he also represented the EWA community by discussing the benefits of EWA and responded to the Committee members with facts and substance.  The IPA looks forward to the continuing conversation with Congress, regulators, and stakeholders regarding the benefits provided by EWA for the American worker.  You can view the IPA press statement for yesterday’s hearing: https://www.linkedin.com/posts/innovativepaymentsassociation_the-innovative-payments-association-commends-activity-7416857157096132609-hytM?utm_source=share&utm_medium=member_desktop&rcm=ACoAAABDgNQBI-oM0PkV9B3IvoXvQwqwzL0B6KU
 
You can view the hearing in its entirety here: https://www.youtube.com/live/wOVzCcuDfSA?si=kanxMqQ_Z6rkYkJ8
 
Steil EWA Discussion Draft 
Prior to the January 13th Fintech hearing, Subcommittee Chair and U.S. Representative Bryan Steil (R-WI) released a discussion draft of his widely expected earned wage access bill.  In brief, highlights from the Discussion Draft include: 

• Requires a no-cost option be made available
• Requires disclosures be made available to consumer prior to any agreement made with consumer regarding limits on any earned wages requested
• Requires disclosures preceding disbursement of any earned wages
• Requires the disclosure of tips
• Requires providers to develop dispute resolution policies
• Fees and Tips will not considered finance charges
• Includes a preemption of state laws provision
• Exempts EWA from TILA

 
The IPA continues to analyze the discussion draft bill.  We urge our members to also review the bill and share their feedback with us prior to the bill’s formal introduction. 
 
CFPB Releases Updated EWA Advisory Opinion 
Days before Christmas, the Consumer Financial Protection Bureau (CFPB) published in the Federal Register a new EWA Advisory Opinion  (AO).  In brief, the AO seeks to outline the conditions in which providers covered by the AO will not be deemed credit.  The IPA has been steadfast advocates for our members companies who are part of the EWA community for several years.  Our goal since 2019 has been to encourage the CFPB to develop a coherent federal framework in which EWA providers can assist working Americans to access the wages they have earned when they need them.
 
The association, alongside our members, led the effort to raise concerns regarding the lack of consistency and clarity from the CFPB when it comes to EWA. Earlier this year, the IPA submitted a letter to the CFPB recommending that the CFPB develop a new updated AO for the industry to follow.  The IPA, and our members, have had numerous conversations related to the benefits of having a new AO for consumers and industry alike.  The IPA also had the opportunity to reaffirm our support for a new AO when we were invited to testify at the CFPB’s Consumer Advisory Board meeting. 
 
Below is a brief overview of the AO: 
 
AO Overview

• Formally withdraws the CFPB’s 2024 Interim Final Rule Proposal
• Employer Sponsored EWA is referred to as, “employer-partnered”
• Safe Harbor for Covered EWA Programs – 4 Prongs:

1. Covered EWA transactions do not exceed the accrued cash value of the wages the worker has earned up to the date and time of the transaction. which amount is determined, based upon payroll data that evidence this amount. A Covered EWA provider does not determine accrued wages based on other information, such as worker representations, or on estimates or predictions of accrued wages.
2. The provider uses a payroll process deduction in connection with the worker’s next payroll event. In a payroll process deduction, payment instructions received and acted upon by the payroll processor (or by the employer itself if it does not use a processor) enable the EWA provider to receive accessed amounts without debiting the consumer’s regular transaction account after the consumer is paid. A transfer to the provider from any of the consumer’s regular transaction accounts after the payment of wages into that account is not a payroll process deduction.
3. Before providing Covered EWA. The provider clearly and conspicuously explains to the worker and warrants to the worker as part of the contract between the parties. that it: (a) has no legal or contractual claim or remedy, direct or indirect, against the worker in the event the payroll process deduction is insufficient to cover the full amount of a Covered EWA transaction, including no right to take payment from any of the consumer’s regular transaction accounts; and (b) will not engage in any debt collection activities related to Covered EWA. place a Covered EWA transaction amount as a debt with or sell it to a third party, or report to a consumer reporting agency concerning Covered EWA.
4. The provider does not directly or indirectly assess the credit risk of individual workers, including through obtaining and reviewing credit reports or credit scores about the individual workers.

• EWA products do not need to be “free” to qualify as Covered EWA program.
• Expedited delivery fees and tips associated with EWA are not inherently finance charges.
• The Advisory Opinion is available to all models of EWA. 
• The CFPB welcomes feedback or questions from the public regarding the AO. 

 
Lastly, IPA member K&L Gates[1] conducted an in-depth legal analysis of the AO, which you can find here: 
 
The IPA will continue to review and analyze the AO.  In the interim, if you have any questions, please contact me at btate@ipa.org. 
 
Digital Asset Market Structure Markup Postponed
Senate Banking Chair Tim Scott (R-S.C.) postponed a January 15th markup of his Digital Asset Market Structure legislation.  The bill (and its House companion) are expected to bring a comprehensive regulatory framework to the crypto marketplace, which is a priority of the Administration and Republican leadership in Congress. Now that the markup has been postponed, the timing of the bills is unclear. It has been reported that the bill has faced some headwinds from the crypto industry, including Coinbase CEO Brian Armstrong, who came out against the bill in its current form. 
 
IPA Files FCC Comment – FCC Delays Implementation of Key TCPA Provision for a Year 
On the first Monday in the new year, the IPA filed a comment responding to the FCC’s Proposed Rule entitled, “Advanced Methods to Target and Eliminate Robocalls.” In brief, the FCC is proposing steps to improve the availability and accuracy of caller identification information transmitted to consumers to enable them to better understand who is calling or messaging and decide whether to answer calls.  Accordingly, the IPA’s comment reaffirms the IPA’s position that the TCPA’s provisions regarding “stop” text communications deserves a second look and that we urge the FCC to grant financial institutions some flexibility to send critical, and in some cases, time sensitive messages even if the account holder has requested not to receive any communications.  The deadline to file comments with the FCC was January 5, 2026.
 
On the same day the comment period closed, the FCC released an Order extending the waiver of section 64.1200(a)(10) of the agency’s rules implementing the Telephone Consumer Protection Act, to the extent the current regulations requires callers to treat a request to revoke consent made by a called party in response to one type of informational message as applicable to all future robocalls and robotexts from that caller on unrelated matters. Specifically, the FCC has found that good cause exists to extend the effective date for this specific requirement from April 2026 to January 31, 2027, to allow for additional time to review the record compiled in response to a recent Further Notice of Proposed Rulemaking and to avoid imposing potentially unnecessary compliance costs on affected parties. 
 
OCC Invites Comments on Core Processor Relationships
Before Thanksgiving, the OCC announced that they have issued a Request for Information (RFI) entitled, “Regarding Community Banks’ Engagement with Core Service Providers and Other Essential Third-Party Service Providers.”  The RFI follows the agency’s 2025 RFI on Digitalization. The OCC is seeking public feedback on key challenges and barriers faced by community banks in engaging with their core service providers and other essential third-party service providers.  The RFI also includes questions on potential actions the OCC could take to address these challenges, including with respect to burden reduction related to supervisory practices, policies, and guidance (e.g., guidance on third-party risk management), as well as other potential agency initiatives.  Lastly, the RFI specifies that it is not intended to impose any obligations or define any rights, and it is not an interpretation of any regulation or statute.  Comments are due on January 27th.  The IPA plans to comment. 
 
OCC Notice on Regulation E – Prepaid Accounts
In mid-December the OCC released a Notice and Request for Comment soliciting public feedback concerning the renewal of its information collection titled, “Reg E—Prepaid Accounts.” Per the release, the CFPB's Prepaid Account final rules require financial institutions to make available to consumers disclosures before a consumer acquires a prepaid account.  Accordingly, the OCC invites comments on the following: 

• Whether the collection of information is necessary for the proper performance of the functions of the OCC, including whether the information has practical utility; 
• The accuracy of the OCC's estimate of the burden of the collection of information; 
• Ways to enhance the quality, utility, and clarity of the information to be collected; 
• Ways to minimize the burden of the collection on respondents, including through the use of automated collection techniques or other forms of information technology; and 
• Estimates of capital or start-up costs and costs of operation, maintenance, and purchase of services to provide information.

 
The deadline to submit comments to the OCC is February 17, 2026. Following the close of this notice's 60-day comment period, the OCC will publish a second notice with a 30-day comment period. The IPA is currently reviewing the OCC’s request and plans to submit a comment.  In the interim, if you have any questions or comments, please send them to Brian Tate (btate@ipa.org).  
 
Hill Confirmed as Chair of the FDIC
Before the Senate adjourned for their end of the year recess, they confirmed Travis Hill to be the next Chair of the FDIC. Hill, who has been serving as the Interim Chairman of the FDIC, is a long time FDIC employee. The new Chair has previously worked at the FDIC from 2018 to 2022, as Deputy to the Chairman for Policy and, before that, as Senior Advisor to the Chairman. In these roles, among other responsibilities, he oversaw and coordinated regulatory and policy initiatives at the agency and advised the Chairman on regulatory and policy matters.
Prior to joining the FDIC, Mr. Hill served as Senior Counsel at the United States Senate Committee on Banking, Housing, and Urban Affairs, where he worked from 2013 to 2018. In this role, he participated extensively in the drafting and negotiating of numerous bipartisan bills. 
 


[1] Please note that the analysis provided by KLGates does not necessarily represent the position of the IPA or our member companies.         

    IPA Mentions/Podcasts/Blogs/Reports:

• IPA PR: IPA Commends Kevin Lefton for his HFSC Testimony 
• IPA Blog: Congress Heads Into Year-End With Funding and Health Care Unresolved
• IPA Blog: A Call for Clarity, Why EWA Guidance Matters
• IPA Pod: Stablecoins are Launching a New Payments Era

Upcoming Calls and Webinars

• Next GRWG Weekly Call – January 26, 2026 
• IPA Webinar: Artificial Intelligence and Data Security
  • Speaker: Robert L. Kardell (Baird Holm)

Events        
         2026 Innovative Payments Conference:

• Dates: April 29 – May 1, 2026
• Location: Mayflower Hotel – Washington, D.C. 
• Featured Keynote Speakers Include: David Wasserman

Thank You to Our Sponsor

The IPA is Coming to Atlanta
On Wednesday, November 12, 2025, the IPA will be hosting a special briefing and reception for our members and invited guests 3:00 PM - 5:30 pm EST.  The briefing will commence at 3:00 PM, followed by a networking reception at 4:00 PM at SKOL Brewing. Light appetizers and refreshments will be provided during the reception. To register for this event please visit: IPA in Atlanta.   

2025 Federal Government Shutdown  
Due to a failure by the House, Senate, and White House to come to an agreement on how to fund the Federal government, at midnight on October 1, 2025, the Federal government shutdown (except for essential staff).  
 
At the time of this writing, no deal has been reached on a continuing resolution (CR) to reopen the government. While informal bipartisan conversations have occurred in the Senate, they haven't produced a path forward. Healthcare remains the primary sticking point for the CR. Objections to Affordable Care Act (ACA) policy have triggered two of the last three extended government shutdowns. Twelve years after the first ACA shutdown in 2013, both parties still hold extremely strong convictions about how healthcare should be delivered in America and who should bear its cost.
 
Both sides are confident that public sentiment remains on their side, or at least not overwhelmingly against them, and it's still too early to tell which party will yield first. Republicans and Democrats continue to appeal to their respective political bases in their messaging, neglecting the broad middle. However, significant political pain could emerge this week as the shutdown begins to impact the lives of everyday Americans through additional federal layoffs, furloughs, and airport delays caused by coordinated absences of TSA and air traffic control personnel. The first post-shutdown payday for the military is next week. 
 
Additional details will be provided as developments occur. 
 
IPA Files Paper Check Fraud Comment 
On August 20, 2025, the prudential banking regulators, the Federal Reserve Board of Governors, the FDIC, and the OCC’s June 20th Request for Information (RFI) regarding mitigating payment fraud, specifically fraud associated with paper checks. In brief, the IPA’s files comment outlines our support for efforts to increase collaboration among stakeholders to prevent check fraud, we support increased education and outreach efforts to consumers, and we support the continued transition from paper checks to electronic payments. Please note that public comments were due to the prudential banking regulators on September 18th.  
 
CFPB’s 1033 Redux
The CFPB’s Open Banking Final Rule continues to receive a lot of attention and scrutiny from the CFPB and the payments industry. As we have reported in the past, the Final Rule is currently in effect, and the litigation regarding the future of the Final Rule continues.
 
In a recent Court hearing on July 29th the CFPB requested, and received from the Court, a stay to develop a new rule (or an amendment).  The CFPB stated that they would like to have a rule within three weeks.  On August 21st the CFPB released its Advanced Notice of Proposed Rulemaking (ANPR) to the Open Banking Rule.  The ANPR covers four key issue areas related to the implementation of section 1033 (aka Open Banking provision) of the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act). 
 
The issues areas where the CFPB seeks public feedback are: the proper understanding of who can serve as a “representative” making a request on behalf of the consumer, the optimal approach to the assessment of fees to defray the costs incurred by a “covered person” in responding to a customer driven request, the threat and cost-benefit pictures for data security associated with section 1033 compliance, and the threat picture for data privacy associated with section 1033 compliance.
 
In response to the ANPR, the IPA has drafted a letter which discusses the definition of “representative,” requests consideration of a fee for data providers, asks for more detail regarding information security, urges the CFPB to consider hosting stakeholder meetings, and additional time for compliance.  The public has until October 21, 2025, to file comments with the CFPB. 
 
Interchange: Judge Supports Corner Post Over the Fed
In early August 2025, Judge Daniel M. Traynor of the US District Court for the District of North Dakota issued an order in Corner Post v. Board of Governors of the Federal Reserve System, which vacated the Federal Reserve’s Regulation II (“the Durbin Amendment”).  However, Judge Traynor stayed his decision overturning Regulation II pending a potential appeal from the Federal Reserve. The Federal Reserve has not made a public comment regarding the ruling.  The Federal Reserve has until October 6thto file its intent to appeal. 
 
Adding layers to an already complicated issue is another similar case to Corner Post, but the outcome was different. In Linney’s Pizza v. the Federal Reserve, U.S. District Judge Gregory Van Tatenhove in the federal court in Frankfort, Kentucky, found the Fed had justified the regulation, which sets a debit fee cap at 21 cents per transaction. The decision was a loss for Frankfort restaurant Linney’s Pizza, which sued in 2022. 
 
If you have any questions, please contact Brian Tate (btate@ipa.org). 
 
Hill Nominated to be Chair of the FDIC
Last week it was widely reported that the current Interim Chairman of the FDIC, Travis Hill, will be nominated to be the full time Chairman of the deposit insurance regulator. Hill, who has already been Senate confirmed for prior positions, will once again go through the Senate confirmation process.  The Interim Chair has previously worked at the FDIC from 2018 to 2022, as Deputy to the Chairman for Policy and, before that, as Senior Advisor to the Chairman. In these roles, among other responsibilities, he oversaw and coordinated regulatory and policy initiatives at the agency and advised the Chairman on regulatory and policy matters.
Prior to joining the FDIC, Mr. Hill served as Senior Counsel at the United States Senate Committee on Banking, Housing, and Urban Affairs, where he worked from 2013 to 2018. In this role, he participated extensively in the drafting and negotiating of numerous bipartisan bills. Before working at the Senate, Mr. Hill worked as a policy analyst at Regions Financial Corporation from 2011 to 2013.
 
Bisignano to be IRS Commissioner While Leading SSA 
On October 6, 2025, U.S. Secretary of the Treasury and Acting Commissioner of the Internal Revenue Service Scott Bessent announced that Commissioner of the Social Security Administration Frank Bisignano will serve as Chief Executive Officer (CEO) of the IRS. In this newly created position, Mr. Bisignano will report directly to Acting Commissioner Bessent, managing the organization and overseeing all day-to-day IRS operations while also continuing to serve in his role as Commissioner of the Social Security Administration.
 
Bisignano, the 18th Senate-confirmed Commissioner of the U.S. Social Security Administration, previously served as Chairman and CEO of Fiserv, the world’s largest financial services and payment technology company. 
 
Fed to Host Payments Conference 
The Federal Reserve of Governors has posted on their website that they plan to conduct a Payments Innovation Conference on October 21, 2025. While the public is invited to participate remotely online, not much is publicly known about the conference itself, including the agenda, speakers, or general attendees.  The IPA plans to participate remotely, but in the interim, if additional details become public, the IPA will share them with our members. 
 
OCC to Reduce Regulatory Burden for Community Banks.
In two bulletins, the OCC clarified examination procedures for community banks. The OCC announced it is removing fixed examination requirements for community banks and instead tailoring the examination scope and frequency to be consistent with risk-based supervision. In a separate bulletin, the OCC clarified its expectations that community banks should tailor model risk management practices commensurate with the bank’s risk exposures, its business activities, and the complexity and extent of its model use. The OCC is also considering additional steps to enhance flexibility and reduce burden related to model risk management. This bulletin is just the first step in refining model risk management guidance for all of the OCC’s regulated institutions.
 
The OCC also requested comments on two proposed rules. The OCC proposed rescinding its Fair Housing Home Loan Data System regulation, removing largely duplicative data collection requirements for national banks. The proposal would eliminate regulatory burden for banks without having a material impact on the availability of data necessary for the OCC to conduct its fair housing-related supervisory activities. The OCC also proposed broadening eligibility for expedited or reduced licensing procedures to community banks. 
 
Related Links

• Bulletin 2025-24, “Examinations: Frequency and Scope”
• Bulletin 2025-25, “Retail Nondeposit Investment Products”
• Bulletin 2025-26, “Model Risk Management: Clarification for Community Banks”
• Bulletin 2025-27, “Rescission of 12 CFR 27, ‘Fair Housing Home Loan Data System’: Notice of Proposed Rulemaking”
• Notice of Proposed Rulemaking, Fair Housing Home Loan Data System (PDF)
• Bulletin 2025-28, “Community Bank Licensing Amendments; Notice of Proposed Rulemaking”

 
Grassley Letter on Class Action Payouts
U.S. Senate Chuck Grassley (R-IA), Chairman of the Senate Judiciary Committee, addressed a letter to John G. Roberts, Jr., Chief Justice, Supreme Court of the United States, regarding the companies selected by federal courts to handle the class action settlement process. According to the Chairman, these companies are receiving “kickbacks” from certain fintech firms who have been hired by federal courts to distribute class action settlement payouts. Further, Sen. Grassley’s letter raises concerns that there appears to be very little oversight by the federal courts on Claims Administrators using digital prepaid cards to facilitate class action settlement payouts.  In brief, Grassley asks the Chief Justice a set of questions that appear to be designed to learn more about the Chief Justice’s oversight of class action settlements. 

IPA Mentions/Podcasts/Reports:

• IPA Pod: Financial Safety for Seniors as a Service
• IPA Pod: September Government Update
• IPA Pod: August Government Update
• IPA Pod: Sioux Falls – Home of Payments Innovation

 
 Upcoming Calls

• Next GRWG Monthly Call – October 16, 2025 
• Next GRWG Weekly Call – October 20, 2025 

 
Events    
 
IPA Money 2020 Reception – Registration Open 

• October 27, 2025 – Las Vegas (Venetian) 
• M2020 Discount ($250) for IPA Members - https://tinyurl.com/27e86u89

 
IPA Briefing & Happy Hour in Atlanta, GA – Registration Open

• November 12, 2025 – Atlanta, Georgia (InComm Offices)

​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​is issued by the Innovative Payments Association twenty times a year as a service to members.
Editors: Brian Tate, President and CEO, IPA; Ben Jackson, COO, IPA;  Eli Rosenberg, Partner, Baird Holm LLP; and Gray Derrick, Partner, Baird Holm LLP. Please address comments and suggestions to: gr@ipa.org.

2025 IPA Compliance Boot Camp 
 
The 2025 Compliance Boot Camp will take place on September 11, 2025, at Discover’s downtown offices in Chicago. CLE Credits will be available to attendees. This immersive educational opportunity will advance your compliance knowledge and help you navigate the complexities of our industry. 
 
What You Can Expect:

• In-depth compliance training tailored to current market challenges
• Interactive sessions with industry experts
• Networking opportunities with fellow payments professionals

• CLE credits available for continuing legal education requirement

2025 Agenda:

• Eli Rosenberg (Baird Holm LLP) – The Latest on On-Demand Wage Payment and Earned Wage Access
• Brian Montgomery (Pillsbury Winthrop Shaw Pittman LLP) – The Future of Open Banking
• Matt White (Greenberg Traurig, LLP) – Regulation E Refresher: Recent CFPB Enforcement Focus & Compliance Tips to Stay Out of the Spotlight
• Joyce Melhman (iLEX Consulting Group) – Third Party Oversight - No One’s Exempt
• Judie Rinearson (K&LGates) – The Future is Now: AI’s growth in the Payments and Fintech Sectors is Changing the Landscape
• Tom Witherspoon (Stinson LLP) – Bank Charters: Who Needs Them?
• Meagan Griffin (Paul Hastings) - Navigating the Evolving Stablecoin Regulatory Landscape: Federal-State Coordination and Industry Roles 

 
Ready to register? Secure your spot today! We look forward to seeing you in Chicago this September!

2025 Fall Congressional Schedule 

• Congress (House & Senate): Currently in Recess. Reconvenes on September 2, 2025.

 
Jonathan Gould Sworn in as Comptroller of the Currency
On July 10th the U.S. Senate voted to confirm the nomination of Jonathan Gould to be the new Comptroller of the Currency. , Prior to his confirmation Gould was a partner at Jones Day.  Please note that Gould also served at the OCC in previous Administrations where he was the Senior Deputy Comptroller and Chief Counsel of the Office of the Comptroller of the Currency (OCC).  You can read Gould’s complete bio at: https://www.jonesday.com/en/lawyers/g/jonathan-gould?tab=overview
 
Michelle Bowman Confirmed to be Next Fed Vice Chair of Supervision
Michelle Bowman has been confirmed as the next Vice Chair for Supervision role at the Federal Reserve.  Bowman, who was already a member of the Federal Reserve Board, fills the post vacated by former Federal Reserve Governor, Michael Barr, who stepped down from the post February 28. Bowman will serve a four-year term. 
 
Senate Finance Reviews McKernan Nomination for Treasury Undersecretary  
On May 9th U.S. Secretary of the Treasury Scott Bessent announced that President Trump would nominate Jonathan McKernan to serve as the Undersecretary of Domestic Finance at the U.S. Department of the Treasury. Since the announcement the President has withdrawn McKernan’s nomination to lead the CFPB. 
 
McKernan has been an advisor at the Treasury Department while awaiting Senate confirmation to lead the Bureau of Consumer Financial Protection. McKernan previously served on the Board of Directors of the Federal Deposit Insurance Corporation and held senior roles at the Federal Housing Finance Agency, the U.S. Senate, and the Treasury Department. 
 
Before his government service, McKernan was an attorney in private practice focused on banking and consumer finance laws. McKernan’s nomination is expected to be reviewed by the Senate Finance Committee.  McKernan’s nomination is likely to continue to move forward when the Senate returns after Labor Day. 
 
Reconciliation Bill Signed Into Law - Remittance Tax and CFPB Funding
On July 4th President Trump signed the Reconciliation bill into law. Amongst the voluminous bill’s tax provisions are provisions that would add a 1% tax on all remittances.  It is important to note that remittances initiated by a bank, or debit/credit card, are exempted. The law also includes language that reduces the CFPB’s access to funding from the Federal Reserve from 12% annually to 6.5%. 
 
Stablecoins 
In July 2025 the President signed the Genius Act into law. The version which ultimately made it through Congress was the Senate version supported in part by U.S. Senator Tim Scott (R-SC), the Chair of the Senate Banking Committee. It permits digital asset providers to create a money market-like fund for digital assets.  This fall Congress will be working on a larger crypto ecosystem market structure bill that will seek to provide a regulatory framework for all digital assets. 
 
CFPB’s 1033 Redux
The CFPB’s Open Banking Final Rule has been subject to debate since it was released last year.  The rule implements Section 1033 of the Dodd-Frank Act. It would have significantly expanded consumer access to their financial data. 
 
A day after the final rule’s release, the Bank Policy Institute challenged the rule in court. Earlier this year, the Financial Technology Association intervened in the case to compel the CFPB to enforce the rule developed by the Biden Administration.  
 
At the IPA’s 2025 Innovative Payments Conference, Mark Calabria (Office of Management and Budget), announced that the CFPB would withdraw and restart its rulemaking regarding 1033, aka the Open Banking Rule.  Shortly after Calabria’s statement at the IPC, the CFPB filed a motion in federal court announcing that “[a]fter reviewing the Rule and considering the issues that this case presents, Bureau leadership has determined that the Rule is unlawful and should be set aside.” 
 
In a recent Court hearing on July 29th the CFPB requested, and received from the Court, a stay to develop a new rule (or an amendment).  The CFPB stated that they would like to have a release a rule within three weeks.  
 
If and when a new proposal is released by the CFPB, the IPA will review the new proposal alongside our members.  In the interim, if you have any questions, please contact Brian Tate (btate@ipa.org). 
 
FDIC Updates Approach on Pre-Populating 
On August 5th the FDIC announced it is updating its supervisory approach regarding whether an FDIC-supervised institution can use pre-populated customer information for the purpose of opening an account to satisfy Customer Identification Program (CIP) requirements.  In short, it is the FDIC’s position that the requirement to collect identifying information “from the customer” under the CIP rule does not preclude the use of pre-filled information. Further, under the FDIC’s interpretation, a financial institution could use information from current or prior accounts or relationships involving the bank or its agents, or other sources, such as parent organizations, affiliates, vendors, and other third parties to pre-fill information that is reviewed and submitted by the customer.
 
IPA Comment Letters Filed in 2025 (to date)

• CFPB: Comment letters on proposed rules for Open Banking, Overdraft Fees, and Nonsufficient Funds (NSF) Fees​
• CFPB: Feedback on upcoming guidance and reinterpretations related to Regulation E and Earned Wage Access (EWA)​
• Federal Reserve: Response to rulemaking on Regulation II (Debit Interchange Fees)​
• IRS: Continued dialogue on tax treatment and reporting requirements for EWA​
• Interagency Discussions: Participation in working groups on bank-fintech partnerships and third-party risk management frameworks​
• Modernizing Government Payments Starts With Prepaid Inclusion​
• OCC Must Recognize the Benefits of Bank-Fintech Partnerships​
• Defending the Integrity of Prepaid Products Amid Election Concerns​
• New Remittance Tax Proposal Threatens Consumer Privacy and Financial Access​
• IPA Urges Thoughtful Reconsideration of TCPA 'Revoke All' Provision​

IPA CEO - 2025 Innovative Payments Conference Thank You
The 2025 Innovative Payments Conference was one for the ages. It was wonderful to get the opportunity to see our members and make connections with future members. From our fabulous speakers, featured guests, and keynotes to our attendees and sponsors, it was great to listen, learn, and laugh with so many different people and companies who make up the payments community.

With the world moving at an incredibly fast pace, it was nice to take a breath and really take in what’s happening in payments so you can plan, plot, strategize for the future. Learning some breaking news first isn’t bad either. IYKYK.

Special thanks to our sponsors for their bedrock support of the IPC: Visa, InComm, Blackhawk, iLex, Bancorp, Pathward, DailyPay, Instant, Discover, Cardaq, Sunrise, Paysign, US Bank, CPI, Newline, Kotapay, Baird Holm, Paul Hastings.

I want to make sure I thank our speakers, including:

• Acting Comptroller of the Currency Rodney Hood, 
• Associate Director for Treasury, Housing, Commerce Mark Calabria, of the Office of Management and Budget
• General Counsel Avy Mallik, of the California Department of Financial Protection & Innovation 
• Jelena McWilliams, the trustee for the Synapse Bankruptcy,
• Roy Sosa, Co-Founder, Chairman and CEO at Ouro Global, Inc., and 
• Pulitzer Prize-winning Author, Jonathan Eig 

 
for taking time out of their busy schedules to share their experiences and insights with IPC attendees.

I want to thank the IPA Team, Steffanie Housman, Anna Drennan, Heather McElrath, and Ben Jackson for going above in beyond for our members. 
 
If you were not able to attend the 2025 IPC, you can learn what happened by visiting: 

• IPA Day 1

• IPC Day 2

In Memoriam: Andrew Siden
​The payments industry lost a thoughtful leader and kind colleague with the passing of Andrew Siden, Founder of Expanse Financial Technology and a valued member of the IPA Board.

Andrew was more than a fintech executive; he was a steady voice in a constantly evolving industry. He brought clarity to complexity and offered insight with precision and humility. Whether you were discussing regulatory hurdles or startup challenges, Andrew approached every conversation with patience, warmth, and curiosity.

I had the great fortune to have the opportunity to work alongside Andrew during my time at the IPA. Andrew was more than just an entrepreneur. Andrew was a colleague, a confidant, and a friend. I will sorely miss him. 

We’re grateful we had the opportunity to capture a piece of Andrew’s story in one of our 2022 podcast episodes; Innovation Requires an Even Keel. In that conversation, he discussed the evolution of his company, the importance of timing and luck in entrepreneurship, and how to lead with both ambition and grace. Listening to it again now reminds us of his thoughtful leadership and enduring optimism.

You can listen to the episode here:
Innovation Requires an Even Keel – IPA Podcast

He will be sorely missed by everyone who knew him.

Congressional Review Act Update

Two Congressional Review Act resolutions were recently signed into law by President Trump. The resolutions remove existing respective regulations from being in effect or prevent them from becoming effective. Further, the agency which issued the regulation cannot reissue a substantially similar regulation without new legislation from Congress. 

First, April 9th the House voted to passed S. J. Res. 28, introduced by U.S. Senator Pete Ricketts (R-NE).  In brief, S.J. Res. 28 repeals the CFPB’s Final Rule for Larger Participants issued in November 2024.  The Senate passed S.J.Res. 28 on March 5th. 
 
Next, the House also voted to pass S.J.Res 18, introduced by U.S. Senator Tim Scott (R-SC), Chair of the Senate Banking Committee.  S.J.Res.18 would repeal the CFPB’s Final Rule on Overdraft Lending issued in December 2024.  The Senate passed S.J. Res.28 on March 27th. 
 
 
CFPB 2025 Supervision and Enforcement Priorities
In April, the CFPB released a memo which outlines the agency’s supervision and enforcement priorities for 2025. According to the memo the CFPB will focus its enforcement and supervision on pressing threats to consumers, particularly service members, and their families. Further, the CFPB will make a shift to focus on depository institutions, as opposed to non-depository institutions. Accordingly, the CFPB will deprioritize: 
 

1. Loans
2. Medical debt
3. P2P platforms and lending
4. Student loans
5. Remittances
6. Consumer data
7. Digital payments

 
Some additional focus points of the memo include: 
 

• Reduction in Supervisory Exams
• Shift Back to Depository Institutions
• Focus on Actual Fraud
• Redress for Tangible Harm
• Support for Service Members and Veterans
• Respect for Federalism
• Coordination with Other Federal Agencies
• Avoidance of Novel Legal Theories

• Fair Lending Enforcement

 
Michelle Bowman Nominated to be Next Fed Vice Chair of Supervision
President Trump has nominated michelle Bowman to fill the Vice Chair for Supervision role which has been vacant since Fed Gov. Michael Barr stepped down from the post Feb. 28. Bowman had been seen as a front-runner to replace Barr since Trump was elected in November. The Senate Banking Committee approved Bowman’s nomination. Further, her nomination was recently filed Cloture to be considered by the full Senate.  If confirmed, Bowman will serve a four-year term. 
 
CFPB Drops PayPal Appeal 
In late April the CFPB decided to drop its appeal in CFPB v. PayPal, which was pending in the U.S. Court of Appeals for the D.C. Circuit.  In brief, the CFPB was appealing a March 2024 ruling (see attached) by Judge Richard Leon which stated:  “the short-form disclosure requirement of the Consumer Financial Protection Bureau’s “Prepaid Accounts Under the Electronic Funds Act (Regulation E) and the Truth in Lending Act (Regulation Z) Rule (Prepaid Rule) as applied to digital wallets is vacated.”
 
Additional details will be provided as developments occur. 
 
WH Memo: DOJ/Treasury to Investigate Straw Donors & Foreign Contributions in Amer. Elections 
On April 25th the President Trump issued a White House Memo directing the U.S. Attorney General and the Secretary of Treasury to “investigate allegations regarding the unlawful use of online fundraising platforms to make “straw” or “dummy” contributions or foreign contributions to political candidates and committees, and to take all appropriate actions to enforce the law.” 
 
Please note that the memo references a recent House Administration Committee investigation into Act Blue regarding political contributions which may have evaded Federal source and amount limitations on political contributions “by breaking down large contributions from one source into many smaller contributions, nominally attributed to numerous other individuals, potentially without the consent or even knowledge of the putative contributors.” In addition, the “reports also raise concerns that such “straw donations” are being made through “dummy” accounts, potentially using gift cards or prepaid credit cards to evade detection.”
 
The memo closes by directing the Attorney General to report back to the President within 180 days. The IPA is preparing to file acomment response with the DOJ and Treasury detailing how payment products are regulated. 
 
OCC RFI on Digitalization
On May 12, the Office of the Comptroller of the Currency released a request for information entitled, “Request for Information Regarding Community Bank Digitalization.” In brief, the RFI has 10 questions designed to solicit comment on the key challenges and barriers faced by community banks in the adoption and implementation of digital banking solutions. 
 
It is important to highlight that the RFI specifically states: “This request is separate from the “RFI on Bank-Fintech Arrangements Involving Banking Products and Services Distributed to Consumers and Businesses,” jointly issued by the OCC, Federal Reserve, and Federal Deposit Insurance Corporation in July 2024. The agencies continue to review and consider the feedback received on that document.”
 
Comments to the OCC are due by midnight on June 26th. At the time of this writing the IPA is working alongside our members to develop a draft response to the RFI. If you have any questions, please contact Brian Tate (btate@ipa.org). 
 
IPA Feedback to FCC on Consumer Messaging
On May 28th, the IPA submitted unsolicited comments to the Federal Communications Commission and the U.S. Department of Treasury regarding the Telephone Communication Protection Act (TCPA). On April 7, 2025, the FCC stayed for one-year provisions requiring a caller (in this case a financial institution) to stop calling across all channels and for all purposes in response to a single “stop” request from a consumer. In brief, the IPA’s letter shares our concerns with TCPA’s restrictions on communicating alert messages from a financial institution to their depositors. 
 
CFPB Announcement Regarding Enforcement Actions Related to BNPL
In early May the Consumer Financial Protection Bureau announced that it will not prioritize enforcement actions against BNPL taken on the basis of the Truth in Lending (Regulation Z); The CFPB will instead keep its enforcement and supervision resources focused on pressing threats to consumers, particularly servicemen and veterans. The CFPB also stated that they may consider taking appropriate action to rescind BNPL.
 
CFPB to Withdraw Rules, Opinions, Statements
On May 12 the CFPB posted in the Federal Register the “Interpretive Rules, Policy Statements, and Advisory Opinions; Withdrawal.”  In brief, the announcement outlines a number of Advisory Opinions, Interpretive Rules, Guidance, and Policy Statements the CFPB plans to withdraw. Accordingly, the announcement states “the Bureau is committed to issuing guidance only where that guidance is necessary and would reduce compliance burdens rather than increase them.” 
 
The list of withdrawals includes:  

• Truth in Lending (Regulation Z); Earned Wage Access Programs, 85 FR 79404 (Dec. 10, 2020)
• Truth in Lending (Regulation Z); Consumer Credit Offered to Borrowers in Advance of Expected Receipt of Compensation for Work, 90 FR 3622 (Jan. 15, 2025)
• Consumer Financial Protection Circular 2024-05: Improper Overdraft Opt-in Practices, 89 FR 8007 (Oct. 2, 2024)
• Consumer Financial Protection Circular 2022-06: Unanticipated overdraft fee assessment practices, 87 FR 66935 (Nov. 7, 2022)
• Consumer Financial Protection Circular 2022-02: Deceptive representations involving the FDIC’s name or logo or deposit insurance, 87 FR 35866 (June 14, 2022)

 
Trump Nominated McKernan for Senior Treasury Post  
Secretary of the Treasury Scott Bessent announced on May 9th that President Trump’s intends to nominate Jonathan McKernan to serve as the Undersecretary of Domestic Finance at the U.S. Department of the Treasury. Since the announcement, the President has withdrawn McKernan’s nomination to lead the CFPB. 
McKernan has been an advisor at the Treasury Department while awaiting Senate confirmation to lead the Bureau of Consumer Financial Protection. McKernan previously served on the Board of Directors of the Federal Deposit Insurance Corporation and held senior roles at the Federal Housing Finance Agency, the U.S. Senate, and the Treasury Department. Before his government service, McKernan was an attorney in private practice focused on banking and consumer finance laws. McKernan’s nomination is expected to be reviewed by the Senate Finance Committee. 
 
IPA Signs Joint Trade Letter Opposing 3.5% Remittance Tax 
The IPA recently signed a joint trade letter addressed to the Senate Finance Committee opposing the inclusion of any tax on remittance transfers in the Senate version of the Reconciliation bill.  In brief, the letter outlines the payment industry’s concerns with taxing remittances, including the potential impact on small businesses, AML compliance, and increases the regulatory burden of providers. Note that the House version of the Reconciliation bill contains a 3.5% tax on remittances. 
Additional details will be provided as developments occur. Please contact Brian Tate (btate@ipa.org) if you have any questions. 
 
Treasury RFI on Executive Order to Modernize Payments
In early June the U.S. Department of Treasury released a Request for Information (RFI) following up on the Executive Order (EO) 14247 “Modernizing Payments To and From America’s Bank Account,” released on March 25th, which transitions federal disbursements to electronic payments. 
 
Beginning September 30, 2025, all federal payments that are currently made by paper check, including Social Security benefits, tax refunds, and vendor payments—will be made electronically. The EO’s policy goals are to defend against financial fraud and improper payments, increase efficiency, reduce costs, and enhance the security of Federal payments. Treasury’s RFI offers the opportunity for interested individuals and organizations to provide feedback on Treasury’s implementation of the Executive Order and make recommendations to increase public awareness to help consumers, including unbanked and underbanked populations, transition to digital payments. 
 
It is worth noting that the executive order continues the efforts to make all federal payments electronic, which began with the Debt Collection Improvement Act of 1996, which requires that all federal payments other than tax refunds be made by electronic funds transfer (EFT) beginning January 2, 1999. The law and the executive order give the Treasury Secretary the ability to offer exemptions. The payments covered by the law include Social Security, veteran’s benefits, Railroad Retirement benefits, federal salaries and federal retiree benefits and vendor payments.
 
The IPA will be submitting comments to the Treasury Department regarding the benefit provided by using prepaid accounts to government benefits. Comments are due to Treasury by June 30th.
 
CFPB’s 1033 Redux
At the IPA’s 2025 Innovative Payments Conference Mark Calabria announced that the CFPB would withdraw and restart its rulemaking regarding 1033, aka the Open Banking Rule, of the Consumer Financial Protection Act (Dodd-Frank). 
 
Recently the CFPB filed a motion in federal court announcing that “[a]fter reviewing the Rule and considering the issues that this case presents, Bureau leadership has determined that the Rule is unlawful and should be set aside.” 
 
The rule implements Section 1033 of the Dodd-Frank Act. It would have significantly expanded consumer access to their financial data. The rule would have had far-reaching implications for financial institutions, fintech companies, and consumers alike. 
The Financial Technology Association has intervened in the case to compel the CFPB to enforce the rule developed by the Biden Administration. It is currently unclear the how the Court eventually rule in this case. 
 
IPA to Join ATPC in Opposing NY Gift Card Bill 
The IPA has been invited to sign a joint trade letter alongside the American Transaction Processing Coalition (ATPC) opposing New York State Senate Bill 704 (New York Gift Certificate Scam Prevention Act). In brief, the letter outlines the industry’s concerns with the current version of SB 704, including the prescriptive nature of the packaging requirements which could stifle innovation in fraud mitigation, leaving consumers less protected. In addition, the bill would require most gift cards to amend their packaging with no phase-in period. 
 
IPA Letter Opposing Connecticut EWA Bill
In early June the IPA sent a letter to the Connecticut General Assembly opposing Connecticut State Senate Bill 1396 (SB 1396).  In brief, SB 1396 would seek to regulate EWA by capping fees, mandate how earned wages are calculated, and require no less than 75% of wages be made available. The IPA’s letter outlines our opposition to the bill and urges the legislature to engage industry on a bill that protects consumers and empowers consumers. 
 
Illinois Interchange Law Effective Date Extended
Last year the Illinois Legislature passed, and the Governor signed a new law that would require bank card issuers and their networks to avoid applying interchanges fees on merchants for taxes and tips on any purchases as of July 1 of this year. But both chambers of the legislature passed a brief amendment Sunday that delays the effective date of the law to July 1, 2026. 
 

Podcasts, Press, and Education

• IPA Op-Ed: Streamline Prepaid Rule 
• IPA Pod: Converting Coins into Digital Money 
• IPA Pod: May GRWG Update
• IPA Blog: Day 1 & 2 at the IPC
• IPA Pod: Innovation, Regulation & the Road Ahead -- Recapping the IPA Conference
• IPA Blog: IPA Welcomes International Partners to IPC
• IPA Book Club: Plato’s Republic
• IPA Pod: Gift Card as Stress Relievers

Upcoming Events and Calls

2025 IPA Compliance Boot Camp  
2025 Compliance Boot Camp: September 11, 2025, Discover: Chicago, IL, (CLE Credits will be available to attendees) 
 Featured Presenters:

• Eli Rosenberg (Baird Holm) – EWA
• Brian Montgomery (Pilsbury) – Open Banking 
• Matt White (Greenberg) – Regulation E
• Joyce Melhman (iLex) – Third Party Compliance
• Judie Rinearson (KLGates) – AI 
• Meagan Griffin (Paul Hastings) – Crypto

​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​is issued by the Innovative Payments Association twenty times a year as a service to members.
Editors: Brian Tate, President and CEO, IPA; Ben Jackson, COO, IPA;  Eli Rosenberg, Partner, Baird Holm LLP; and Gray Derrick, Partner, Baird Holm LLP. Please address comments and suggestions to: gr@ipa.org.

The IPA Drafts a Comment Letter on the Proposed Interpretive Rule on Reg. E – Comments Due 3/31 
 
The IPA has prepared a comment letter on the Consumer Financial Protection Bureau’s (CFPB) proposed Interpretive Rule on Regulation E.
 
Key aspects of the rule include:

• Clarifying the scope of Regulation E to include digital assets like stablecoins and nonbank payment providers.
• Ensuring consistent consumer protections, such as safeguards against unauthorized transactions and error resolution rights, across both traditional and emerging payment systems.

 
IPA is asking for the rule to be withdrawn because it is overly broad and does not take into account different aspects of the products it seeks to cover. The rule was proposed on Jan. 10, before the inauguration, so it may end up withdrawn by the new administration. 
 
The IPA is Preparing for its Annual Innovative Payments Conference
Make plans to join us in Washington DC from April 29 through May 1 for the Innovative Payments Conference to hear from legislators, regulators, and industry experts about the forces shaping your business. 
Sessions will include discussions about fraud prevention with Visa, the future of federal payments, and a fireside chat with former FDIC Director Jelena McWilliams, and Avy Malik, General Counsel, the California of Financial Protection and Innovation. 

Learn more and register here: Innovative Payments Conference
​

The Senate Approves the Larger Participant Congressional Review Act Resolution
A Congressional Review Act (CRA) resolution aimed at overturning the Larger Participant rule from  the CFPB was introduced in the Senate by Senator Pete Ricketts (R-NE) and in the House by Rep. Mike Flood (R-NE-01) on Feb. 27. 
 
This rule, which took effect in January 2025, expanded the CFPB's authority to supervise nonbank consumer payments fintechs. These "larger participants" include companies like payment apps and digital wallets that handle at least 50 million consumer payment transactions annually.
 
The Senate's approval of this CRA resolution moves the rule one step closer to nullification. The resolution also must pass in the House of Representatives and be signed into law by the President. Proponents of the resolution argue that the CFPB's rule imposes unnecessary regulatory burdens on an already well-regulated industry, potentially stifling innovation and increasing costs for consumers. Critics, however, believe that the rule provides essential oversight to protect consumers from fraud and other risks associated with digital payment services.
 
The next steps involve the House of Representatives voting on the resolution. If it passes there, it will go to the President for approval or veto. If signed into law, the CFPB's rule will be overturned, and the agency will be restricted from issuing a substantially similar rule in the future without new legislation.
 
You can find an overview of the Congressional Review Act Process here: The Congressional Review Act (CRA): A Brief Overview | Congress.gov | Library of Congress.
 
House Financial Services Committee Approves Overdraft CRA Resolution
On Feb. 13, House Financial Services Chair, French Hill (R-AR-02) introduced a resolution to disapprove and nullify the "Overdraft Lending: Very Large Financial Institutions" rule issued by the CFPB. The rule aimed to cap overdraft fees charged by large financial institutions.
On March 5, 2025, the committee voted to report the resolution to the full House for further consideration.
Supporters of the resolution argue that the CFPB's rule imposes unnecessary price controls, which would limit financial institutions' ability to offer overdraft services. Critics of the resolution believe that the CFPB's rule is necessary to protect consumers from excessive fees and promote fairness in financial services.
The resolution would still need to pass the Senate and be signed by the president. 

McKernan Nomination for CFPB Director Advances to Full Senate
Jonathan McKernan's nomination to be the director of the Consumer Financial Protection Bureau (CFPB) passed the Senate Banking Committee on March 6, in a 13-11 party-line vote.
Currently, the CFPB is led by Treasury Secretary Scott Bessent, who was appointed as Acting Director on Feb. 3, following the dismissal of Rohit Chopra.

Michelle Bowman Nominated to be Next Fed Vice Chair of Supervision
Michelle Bowman has been nominated by President Trump to fill the Vice Chair for Supervision role which has been vacant since Fed Gov. Michael Barr stepped down from the post Feb. 28. Bowman had been seen as a front-runner to replace Barr since Trump was elected in November. 
Bowman must go through the typical nomination process: a hearing in front of the Senate Banking Committee, whose members will then vote on whether to advance the nomination to the full Senate, which then must confirm her.
Sen. Tim Scott, R-SC, the Senate Banking Committee’s chair, called Bowman “an important voice on the Federal Reserve Board in pushing back on burdensome rules and regulations that stifle economic opportunity. 

The FDIC Withdraws Four Proposed Rules
On March 3, the Federal Deposit insurance Corp. (FDIC) announced that it was withdrawing three proposed rules: the brokered deposits restrictions, guidelines for corporate governance, and regulations implementing the Change in Bank Control Act.
The proposed brokered deposits rule would have overturned earlier changes won by the IPA that led to the primary purpose exemption from brokered deposits rules. 

The CFPB Ends its Lawsuit Against Zelle
In December, the CFPB sued Early Warning Services, which operates peer-to-peer payments service Zelle, along with three of its owner banks—Bank of America, JPMorgan Chase, and Wells Fargo, alleging that the companies did not investigate fraud and reimburse consumers for fraud and error. 
In March the CFPB said it was dropping its lawsuit “with prejudice,” according to CNBC. This was one of six suits that the Bureau has dropped since its previous director, Rohit Chopra was fired. 

OCC Oks Banks to Engage in Crypto Activities
 On March 7, the Office of the Comptroller of the Currency published Interpretive Letter 1183 to confirm that crypto-asset custody, certain stablecoin activities, and participation in independent node verification networks such as distributed ledger are permissible for national banks and federal savings associations. The letter also rescinds the requirement for OCC-supervised institutions to receive supervisory nonobjection and demonstrate that they have adequate controls in place before they can engage in these cryptocurrency activities.
“The OCC expects banks to have the same strong risk management controls in place to support novel bank activities as they do for traditional ones,” said Acting Comptroller of the Currency Rodney E. Hood. “Today’s action will reduce the burden on banks to engage in crypto-related activities and ensure that these bank activities are treated consistently by the OCC, regardless of the underlying technology. I will continue to work diligently to ensure regulations are effective and not excessive, while maintaining a strong federal banking system.”

Podcasts, Press, and Education

• IPA Book Club: Plato’s Republic
• IPA Pod: Gift Card as Stress Relievers
• IPA Blog: Regulatory Chessboard Reconfigured
• IPA Pod: Elon Musk’s Access to Federal Payments System
• IPA Pod: The First Regulatory Moves of the New Administration

 
​ Upcoming Events and Calls
o          Next IPA Weekly GRWG Call – March 24, 2025
o          Next IPA Monthly GRWG Call – March 20, 2025

2025 Industry Outlook and New Regulatory Shifts: How IPA is Shaping the Future of PaymentsAs we enter 2025, the payments industry finds itself at a pivotal juncture, shaped by shifting regulatory landscapes and evolving political priorities. With a new administration and the 119th Congress taking office, the Innovative Payments Association (IPA) is doubling down on its commitment to advocate for clear policies and promote innovation in financial services.

The recent Republican sweep of the White House and Congress has sparked debates about deregulation and reshaping financial oversight. Proposals to repeal existing regulations through the Congressional Review Act (CRA), calls to eliminate the Consumer Financial Protection Bureau (CFPB), and other deregulatory measures suggest significant changes may be on the horizon. However, industry leaders must temper their expectations. History shows that even in a politically aligned government, regulatory shifts are rarely straightforward or absolute.

While deregulatory measures such as revisiting the Open Banking Rule may gain momentum, their implementation faces procedural and legal challenges. Additionally, the CFPB, often seen as a target for reform, may remain a key player under the new administration. With its record of bipartisan enforcement actions and new authority to regulate big tech, the agency may adapt rather than disappear.

In this uncertain landscape, the payments community must maintain robust compliance and advocacy strategies. At the same time, leaders in Congress and the administration must recognize the vital role of financial technology in driving economic growth.

Unleashing the Potential of Payments Innovation
The payments industry has long been a cornerstone of financial inclusion, empowering millions of Americans with tools to manage their finances, save money, and achieve their goals. Yet inconsistent regulatory approaches have stifled the full potential of financial technology (fintech) products such as earned wage access, mobile wallets, and fintech debit accounts.

Despite challenges, the industry has achieved remarkable milestones. The FDIC’s latest report shows that 96% of American households are banked—the highest level in nearly 20 years—thanks in part to diverse fintech offerings. These innovations have brought more people into the mainstream financial system than ever before.

However, contradictory regulatory signals remain a barrier. For example, while the CFPB mandates data sharing between financial institutions and fintechs, it also warns consumers to approach fintech products with caution. Similarly, the FDIC proposes rules that could increase costs for these same products, undermining their accessibility and impact.

The payments industry supports reasonable, evidence-based regulation that balances consumer protection with innovation. To truly harness the promise of fintech, policymakers must move beyond political agendas and work collaboratively with the industry to establish clear, consistent, and practical guidelines.

IPA’s Vision for 2025
The Innovative Payments Association is ready to play a central role in shaping the future of payments. Through strategic advocacy, education, and collaboration with stakeholders, the IPA aims to:

• Advocate for policies that promote competition, innovation, and consumer protection.
• Encourage the adoption of a national regulatory framework that supports fintech growth.
• Provide resources and insights to help members navigate the evolving political and regulatory landscape.

 
Now is the time to unleash the potential of financial technology to improve lives and support economic growth. By working together, policymakers, regulators, and the payments community can build a stronger, more inclusive financial system that benefits all Americans. 

55% of Payments Firms Say Compliance Function is Overwhelmed at Least 1x Month

As we step into the new year, many payments firms are already feeling the weight of their compliance burdens, with an expectation that it will only increase in 2025. 

Staying ahead requires real-time insights into regulatory changes, industry trends, and technological advancements to make informed decisions and tackle compliance challenges effectively.

To help you navigate this landscape, IPA member Vixio Regulatory Intelligence surveyed 127 payments organizations worldwide and created this forward-looking report to give you actionable insights into the evolving regulatory environment.

What’s inside?
➡️ The biggest challenges payments organizations are facing
➡️ Key growth opportunities for 2025
➡️ Practical strategies to navigate challenges and ensure compliance
...and more!

Download your copy here: https://discover.vixio.com/paymentscompliance-pc-outlook-report-2025-ipa/ 

Trump Issues Regulatory Freeze
Within a few hours of his swearing in, President Trump issued a number of Executive Orders. Among the dozens of EO’s signed by the President was an EO entitled, “Regulatory Freeze Pending Review.” You can read the full order below or here: Regulatory Freeze Pending Review – The White House
 
By the authority vested in me as President by the Constitution and the laws of the United States of America, I hereby order all executive departments and agencies to take the following steps:
 

1. Do not propose or issue any rule in any manner, including by sending a rule to the Office of the Federal Register (the “OFR”), until a department or agency head appointed or designated by the President after noon on January 20, 2025, reviews and approves the rule.  The department or agency head may delegate this power of review and approval to any other person so appointed or designated by the President, consistent with applicable law.  The Director or Acting Director of the Office of Management and Budget (the “OMB Director”) may exempt any rule that he deems necessary to address emergency situations or other urgent circumstances, including rules subject to statutory or judicial deadlines that require prompt action.
2. Immediately withdraw any rules that have been sent to the OFR but not published in the Federal Register, so that they can be reviewed and approved as described in paragraph 1, subject to the exceptions described in paragraph 1. 
3.  Consistent with applicable law and subject to the exceptions described in paragraph 1, consider postponing for 60 days from the date of this memorandum the effective date for any rules that have been published in the Federal Register, or any rules that have been issued in any manner but have not taken effect, for the purpose of reviewing any questions of fact, law, and policy that the rules may raise.  During this 60-day period, where appropriate and consistent with applicable law, consider opening a comment period to allow interested parties to provide comments about issues of fact, law, and policy raised by the rules postponed under this memorandum, and consider reevaluating pending petitions involving such rules.  As appropriate and consistent with applicable law, and where necessary to continue to review these questions of fact, law, and policy, consider further delaying, or publishing for notice and comment, proposed rules further delaying such rules beyond the 60-day period.
4. Following the postponement described in paragraph 3, no further action needs to be taken for those rules that raise no substantial questions of fact, law, or policy.  For those rules that raise substantial questions of fact, law, or policy, agencies should notify and take further appropriate action in consultation with the OMB Director.
5. Comply in all circumstances with any applicable Executive Orders concerning regulatory management.

 
As used in this memorandum, “rule” has the definition set forth in section 551(4), title 5, United States Code.  It also includes any “regulatory action,” as defined in section 3(e) of Executive Order 12866 of September 30, 1993, as amended, and any “guidance document” as defined in section 2(b) of Executive Order 13891 of October 9, 2019 (Promoting the Rule of Law Through Improved Agency Guidance Documents), when that order was in effect.  Thus, the requirements of this memorandum apply not only to “rules” as defined in section 551(4) of title 5, but also to any substantive action by an agency (normally published in the Federal Register) that promulgates or is expected to lead to the promulgation of a final rule or regulation, including notices of inquiry, advance notices of proposed rulemaking, and notices of proposed rulemaking.  They shall also apply to any agency statement of general applicability and future effect that sets forth a policy on a statutory, regulatory, or technical issue or an interpretation of a statutory or regulatory issue.
 
The OMB Director shall oversee the implementation of this memorandum, and any communications regarding any matters pertaining to this review should be addressed to the OMB Director.  The OMB Director is also authorized to establish a process to review pending collections of information under the Paperwork Reduction Act of 1995, as codified in chapter 35, title 44, United States Code, and to take actions that the OMB Director deems appropriate based on that review, consistent with applicable law.
 
Should actions be identified that were undertaken before noon on January 20, 2025, that frustrate the purpose underlying this memorandum, I may modify or extend this memorandum, to require that department and agency heads consider taking steps to address those actions.
 
The OMB Director is authorized and directed to publish this memorandum in the Federal Register.
 
This memorandum shall be implemented consistent with applicable law.
 
Trump Elevates Hill to Acting FDIC Chairman 
President Trump has elevated FDIC Vice Chair, Travis Hill, to Acting Chairman of the agency.  On his first day in his new position, Acting Chairman Hill released the following statement: “It is my honor and privilege to serve as Acting Chairman of the FDIC.  While the FDIC faces a broad range of issues, and as always will fulfill our mandate to promote a safe, sound, and resilient banking system, below is a list of matters I expect the FDIC to focus on in the coming weeks and months.”  
 
Amongst the several changes the new Acting Chair would like to implement are: 
 

• Adopt a more open-minded approach to innovation and technology adoption, including (1) a more transparent approach to fintech partnerships and to digital assets and tokenization, and (2) engagement to address growing technology costs for community banks.
• Withdraw problematic proposals from the past three years, such as proposals on brokered deposits and corporate governance.

To read the Acting Chairman’s full statement please visit the FDIC’s website here. 
 
Chopra Remains CFPB Director Post Inauguration 
Prior to January 20th, the prevailing conventional wisdom was that President Trump would move to immediately remove Rohit Chopra as Director of the Consumer Financial Protection Bureau.  As of this writing, Director Chopra still leads the CFPB.  However, it is widely expected that Trump will soon take steps to relieve Chopra of his duties. There are several theories why this has not taken place yet.  One is that the Trump administration could be waiting to have a few more Senate-confirmed officials, such as Scott Bessent at Treasury or Russ Vought at OMB before taking the affirmative steps to officially nominate someone to replace Chopra. 
 
IPA Responds to FEC Notice on Payment Forms
On January 27, 2025, the IPA filed comments responding to the Federal Election Commission’s published notice in the Federal Register entitled, “Contributions Through Untraceable Electronic Payment Methods.” The FEC sought public comment on whether it should proceed with such a full rulemaking. Comments were due to the FEC by January 27, 2025.  
 
The FEC released its request at the behest of Texas Attorney General Ken Paxton wrote the FEC petitioning it “to amend its regulations concerning the use of credit cards to make contributions, to address the potential use of prepaid cards to circumvent contribution amount limitations and source prohibitions.”  
 
The Petition asks the Commission to adopt two amendments to its regulations which would require that when contributions are made by credit, debit, prepaid or gift card, the campaign committee must “cross-check” the donor’s name and address with that information held by the issuer and contributions cannot be accepted from prepaid or gift cards unless the information from those prepaid or gift cards has been cross-checked. 
 
In brief, the IPA’s comments outline how heavily regulated payment products are by their primary regulator and the CFPB.  Thus, we urge the FEC not to take steps add an additional layer of regulation since payment products are used by millions of Americans to make campaign contributions. 
 
CFPB Rescinds 2020 EWA Advisory Opinion 
On January 6, 2025 the CFPB quietly, without any public announcement published an advisory opinion on its website to rescind the advisory opinion it issued in November 2020 related to EWA.  In brief, the CFPB states it “is rescinding the 2020 Advisory Opinion for two fundamental reasons: (i) its legal analysis is significantly flawed in numerous respects; and (ii) it engendered substantial regulatory uncertainty.”
 
More specifically, the CFPB writes that the 2020 Advisory Opinion was flawed due to: 
 

• “The first analytical flaw of the 2020 Advisory Opinion is that its consideration of the meaning of “debt” under state law was insufficient.”
• Second, the 2020 Advisory Opinion inferred that the consumer does not incur a liability when using the narrowly limited type of earned wage product covered by the opinion, but did not sufficiently justify the inference.
• Third, the 2020 Advisory Opinion did not consider all relevant factors as part of the “totality of the circumstances” approach it applied to determine what is “credit.”
• Fourth, the opinion’s claim that it was supported by certain statements in the 2017 Payday Rule is unpersuasive.

 
The advisory opinion is in effect as soon as it is published in the Federal Register. 

​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​is issued by the Innovative Payments Association twenty times a year as a service to members.
Editors: Brian Tate, President and CEO, IPA; Ben Jackson, COO, IPA;  Eli Rosenberg, Partner, Baird Holm LLP; and Gray Derrick, Partner, Baird Holm LLP. Please address comments and suggestions to: gr@ipa.org.

Dear IPA Member:
 
As we start wrapping up an eventful year, we are proud to share the Innovative Payments Association’s 2024 Annual Report. This year, we’ve made significant strides in advocacy, regulatory engagement, and industry leadership to support the growth and innovation of the payments industry.
 
From driving meaningful discussions on regulatory changes to expanding educational initiatives like the Summer of Learning and Compliance Boot Camp, 2024 has been a year of impactful achievements made possible by your continued support.
 
We'd like to invite you to explore our Annual Report, highlighting key milestones and sharing insights into 2025. Read the report here.
 
Thank you for being an essential part of our community. We look forward to working together in the year ahead to continue driving innovation and success in the payments industry.
 
Sincerely,

Brian C. Tate
President & CEO
Innovative Payments Association

President Trump Reelected
On November 5, 2024, former President Trump was reelected President of the United States. Trump will be inaugurated on January 20, 2025.  

One week after the election the IPA held a post-election review with IPA members.  The review was accompanied by a post-election analysis conducted by OGR.  

President-elect Trump has started the process of nominating people for Cabinet positions and other key national level posts, such as: Scott Bessent for Treasury Secretary, David Sacks for AI & Crypto Czar , and Paul Atkins for SEC Director. As of this writing, the incoming President has not nominated any one to fill positions at the Consumer Financial Protection Bureau, Federal Deposit Insurance Corporations, of the Office of the Comptroller of the Currency.  Nominees for the prudential regulators and the CFPB will likely be made prior to Inauguration Day in January.  


French Hill Named Chair of the House Financial Services Committee
Last week U.S. Representative French Hill (R-Arkansas) was named the next Chairman of the House Financial Services Committee.  You can learn more about the new Chairman by visiting his website at: https://hill.house.gov/

Chairman Hill has an extensive financial services background. In the 118th Congress he serves as the Vice Chairman of the House Financial Services Committee and as Chairman of the new subcommittee tasked with overseeing all areas related to digital assets and financial technology. 

Prior to his congressional service, Congressman Hill was founder, Chairman, and Chief Executive Officer of Delta Trust & Banking Corporation. From 1989 to 1991, he also served as Deputy Assistant Secretary of the Treasury for Corporate Finance. After the fall of the Berlin Wall, Rep. Hill led the design of U.S. technical assistance to the emerging economies of eastern and central Europe in the areas of banking and securities. In 1991, President Bush appointed Rep. Hill to be Executive Secretary to the President’s Economic Policy Council (EPC), where he coordinated all White House economic policy.  
The IPA has a long-standing relationship with Chairman Hill and his staff.  Please note that Chairman Hill spoke at the IPA’s 2019 Innovative Payments Conference.   We wish Chairman Hill good luck in his new role. 
 
IPA Responds to FDIC Proposed Rule on Brokered Deposits
At the end of July the FDIC released a Proposed Rule on Brokered Deposits.  The FDIC also released a statement regarding the proposal you can read here. 
 The FDIC’s proposal makes significant changes to current regulation, including the “Enabling Transactions” exception to the brokered deposit regulations for third party relationships that was included in the 2020 Brokered Deposits Final Rule. (This exemption came about through efforts led by the IPA and its members.)   As expected, Chairman Martin Gruenberg’s remarks at the FDIC’s Board Meeting referenced the failed business arrangements connected to Synapse, SVB, Voyager, and others as reasons for the changes. 
Below are some key changes the proposal makes to the current brokered deposit regulations:

• It revises the definition of “deposit broker” to combine the “placing” and “facilitation” prongs into a single definition with single set of factors for determining when a third party acts as a deposit broker.
• It eliminates the exclusive deposit placement arrangement exception.
• It eliminates the “enabling transactions” test for application of the primary purpose exception.
• It removes the ability for third parties to apply for application of the primary purpose exception. Under the proposal, only the IDI would be able to apply. 
  
  

The IPA has filed our response to the FDIC in November 2024.  The IPA’s letter focused on several key points, including, but not limited to, treating fintech-bank accounts as de facto “brokered” is not consistent with Federal Deposit Insurance Act or the history and intent of the brokered deposits regulatory framework based on FIRREA. In addition, the FDIC’s proposed classification of fintech-bank accounts as de facto “brokered” is not supported by the FDIC’s own rationale which is grounded in unrelated bank failures.  You can read the IPA’s letter here.
 
IPA Files Comment Response to Bank-Fintech Ledger
The IPA has finalized and filed our comments responding to the FDIC’s proposed rule entitled, “Recordkeeping for Custodial Accounts.” In brief, the proposal would require all banks partnered with a third party to either maintain a ledger of FBO accounts via third-party fintechs or have direct access to a ledger maintained by a fintech so they can reconcile the accounts each day.  The deadline for the public to submit comments to the FDIC is January 16, 2025. 
 
The IPA’s comments outline our concerns with the proposal, including concerns regarding the scope of the proposal which we believe would extend to products the FDIC did not intend to cover, including gift cards, corporate cards, savings accounts, and wealth management accounts. Lastly, the IPA believes the FDIC needs to sync up their proposed changes to FDIC section 370 and the current 370 requirements, so banks aren’t subject to two sets of requirements that are similar in certain respects but different in other respects.   
 

FDIC Releases 2023 Unbanked and Underbanked Study
On November 12, 2024, the FDIC released its biannual national survey on the unbanked and underbanked. The 2023 FDIC National Survey of Unbanked and Underbanked Households found that nearly 96 percent of all U.S. households were banked in 2023,

In addition, the FDIC survey found two-thirds (66.2 percent) of unbanked households relied entirely on cash while a third (33.8 percent) of unbanked households relied upon a combination of prepaid cards or nonbank online payment services such as PayPal, Venmo or Cash App to conduct transactions.
Other key findings include:

• The Underbanked Rate – 14.2 percent of U.S. households (representing 19.0 million households) were underbanked in 2023, meaning these households had a bank or credit union account yet primarily used nonbank products and services to meet their financial needs.
• Mobile Banking – Nearly half of banked households (48.3 percent) used mobile banking as their primary method to access their accounts. 
• Nonbank Online Payment Services and Prepaid Cards – Between 2021 and 2023, use of nonbank online payment services such as PayPal, Venmo, or Cash App increased, while the use of general purpose reloadable prepaid cards decreased. 
• Credit Cards – 76.4 percent of all households had a credit card in 2023. However, about one-in-six households (15.7 percent) had no access to mainstream credit, down from 20.0 percent in 2017. 
• Buy Now, Pay Later –In 2023, 3.9 percent of all households used BNPL in the past 12 months.
• Crypto –In 2023, 4.8 percent of U.S. households owned or used crypto or digital assets in the previous 12 months. 

 
CFPB Issues Overdraft Final Rule 
On December 12th  the CFPB issued a final rule amending their current rules, Regulations E and Z, in part, to treat overdraft products as credit, unless the overdraft fee is capped at $5 or an amount that covers a financial institution’s costs and losses. Banks and credit unions over $10 billion will need to comply with Regulation Z’s requirements for loans, including providing consumers with a choice on whether to open a line credit. In addition, financial institutions will have to give consumers disclosures, periodic statements, and allowing consumers to decide whether to pay automatically or manually. The final rule will go into effect on October 1, 2025.

 
FEC Seeks Feedback on Payment Forms
The Federal Election Commission recently published a notice in the Federal Register entitled, “Contributions Through Untraceable Electronic Payment Methods.” The FEC is seeking public comment on whether it should proceed with such a full rulemaking. 
 
In brief, Texas Attorney General Ken Paxton wrote the FEC petitioning it “to amend its regulations concerning the use of credit cards to make contributions, to address the potential use of prepaid cards to circumvent contribution amount limitations and source prohibitions.”  The Petition asks the Commission to adopt two amendments to its regulations which would require that when contributions are made by credit, debit, prepaid or gift card, the campaign committee must “cross-check” the donor’s name and address with that information held by the issuer and contributions cannot be accepted from prepaid or gift cards unless the information from those prepaid or gift cards has been cross-checked. Comments are due to the FEC by January 27, 2025.  
 
The IPA will continue to review the FEC’s request and is planning to draft a response.  In the interim, please send any questions to Brian Tate (btate@ipa.org). 
​

Shield Act Passes House 
U.S. Representative Bryan Steil (R-WI), Chairman of the House Committee on House Administration, 
and sponsor of the Secure Handling of Internet Electronic Donations (SHIELD) Act released a press 
release announcing the bills passage in the House of Representative by Voice Vote.  In brief, 
The SHIELD Act prohibits political committees from accepting online contributions from debit or credit 
cards without the disclosure of the card verification value, or CVV, and the billing address associated 
with the card.  The IPA has had several conversations with Chairman Steil’s office and remains 
concerned about additional regulation being layered on already heavily regulated prepaid account 
products.  

Key 2025 Election Dates

• January 3, 2025: 119th Congress Swearing In
• January 20, 205: Inauguration Day

 
2025 Congressional Calendars

• 2025 House Calendar
• 2025 Senate Calendar

 
Podcasts, Press, and Education
 
IPA Mentions/Reports:

• IPA Blog: The FDIC Should Look Inward Before Pointing Fingers Out

• IPA Pod: Is Pay By Bank the Future of Payments
• IPA Pod: Think Like and Innovator 
• IPA Pod: Nov. 2024 Government Update 
• IPA Blog: Challenge Your Assumptions About the Election 

Articles and Reports:

• Digital Transactions: 
• Payments 3.0: Humanity And the War on Gift Card Fraud – Digital Transactions

 
Upcoming Events and Calls

• Next IPA Weekly GRWG Call: January 6, 2025 (tentative)

​IPA Releases Bank-Fintech Guide
On September 17, 2024, the IPA released a game-changing resource: "IPA's Guide to Developing a Bank-Fintech Regulatory Compliance Plan." As financial institutions work more with fintech companies, regulatory compliance is more important than ever. This guide offers a detailed look at the critical legal and regulatory issues that banks and fintechs must address. It is an essential resource for any organization looking to innovate in the financial sector while meeting strict regulatory requirements.

The guide covers vital topics, including:

• The roles and responsibilities of banks and fintechs in maintaining compliance.
• An overview of relevant regulations such as Regulation E, Regulation Z, the Bank Secrecy Act, and others.
• Practical considerations for developing a robust compliance plan.
• Guidance on third-party risk management, drawn from recent statements and guidance from federal banking agencies.

 
The guide is not meant to replace legal advice but to offer a framework to help companies develop comprehensive compliance programs, which protect both their interests and those of their partners and customers. IPA members can download a copy of the guide in the “Members Only” section of the IPA’s website: www.ipa.org. 
 
IPA’s 2024 Compliance Boot Camp is a Success
On September 11, 2024, the IPA held its annual Compliance Boot Camp in Chicago. This year’s event was the IPA’s largest compliance event to date. First, the IPA would like to thank everyone who traveled to Chicago to participate, including attendees and presenters. Next, the IPA would like to thank our gracious hosts at Discover. We look forward to hosting additional compliance events in the future, but in the meantime, please review IPA COO Ben Jackson’s recap of the event on the IPA’s Blog. 

​Congress in Recess – Lame Duck Session After Election
At the end of September, the House and Senate went into a month-long recess. Congress is expected to return to conduct a lame-duck session after the elections on November 5th. The post-election session of Congress is expected to run into early December. Major issues Congress is likely to address will focus on must pass legislative issues such as funding for the federal government.  In addition, Committees may hold hearings while Congress is in session. At the time of this writing, the House Financial Services Committee and Senate Banking Committee, respectively, are expected to hold hearings featuring the prudential regulators (FDIC, OCC, the Federal Reserve), and the CFPB. Additional details will be provided as developments occur. 
 
IPA Files Comment on CFPB Proposed Interpretive Rule for EWA 
On July 18th the CFPB released their “Proposed Interpretive Rule” on EWA. The CFPB also published a report examining employer-sponsored paycheck advance loans.  In brief, the proposal identifies two primary types of EWA products: employer-partnered and direct-to-consumer. Further, the proposal addresses the application of certain Regulation Z and TILA provisions. Other key points from the proposal include: 

• The Interpretive Rule will replace the CFPB’s 2020 Advisory Opinion. 
• It mischaracterizes EWA products as a loan and EWA providers as “lenders.” 
• It applies Regulation Z to EWA, and accompanying Disclosures.
• Fees for “tips” and expedited delivery will be finance charges under TILA. 

 
Accordingly, the IPA responded to the proposal by filing a comprehensive comment which outlines our concern with how EWA does not resemble credit, the benefits of EWA, and a request for the CFPB to conduct additional study before finalizing their proposal. In addition, the IPA met with the CFPB in September to seek out additional details and to inform the agency that implementation will require more clarification since the proposal was limited in its requirements. 
 
Prudential Regulator RFI on Fintechs
In late July, the Federal Deposit Insurance Corporation, Federal Reserve Board, and Office of the Comptroller of the Currency released a statement on the potential risks associated with third-party bank relationships and the responsibilities of financial institutions to take note of all applicable laws, rules, and guidance. In addition, the agencies also issued a Request for Information to learn more about bank-fintech arrangements, including deposits, payments, lending services and risk management.  
Please note the IPA believes this RFI is the first step in additional requests and rulemakings for the payments community. 
 
The IPA has recently filed our comments responding to the prudential regulators. In brief, the IPA’s comment letter discusses the current responsibilities of financial institutions who partner with third parties, including the laws and regulations in place today that extend to payment products overseen and enforced by the prudential regulators and the CFPB. If you are planning to file your own comment in response to the proposal, please note that the deadline for submissions to the prudential regulators is October 30th. 
 
FDIC Rolls Back Exceptions to Brokered Deposits
At the end of July the FDIC released a Proposed Rule on Brokered Deposits.  The FDIC also released a statement regarding the proposal you can read here. 
 
The FDIC’s proposal makes significant changes to current regulation, including the “Enabling Transactions” exception to the brokered deposit regulations for third party relationships that was included in the 2020 Brokered Deposits Final Rule. (This exemption came about through efforts led by the IPA and its members.)  Accordingly, Chairman Martin Gruenberg’s remarks at the FDIC’s Board Meeting referenced the failed business arrangements connected to Synapse, SVB, Voyager, and others as reasons for the changes.
 
Below are some key changes the proposal makes to the current brokered deposit regulations:

• It revises the definition of “deposit broker” to combine the “placing” and “facilitation” prongs into a single definition with single set of factors for determining when a third party acts as a deposit broker.
• It eliminates the exclusive deposit placement arrangement exception.
• It eliminates the “enabling transactions” test for application of the primary purpose exception.
• It removes the ability for third parties to apply for application of the primary purpose exception. Under the proposal, only the IDI would be able to apply.

 
At the time of this writing the IPA is preparing a response to the FDIC that will focus on several key points, including, but not limited to, treating fintech-bank accounts as de facto “brokered” is not consistent with Federal Deposit Insurance Act or the history and intent of the brokered deposits regulatory framework based off of FIRREA. In addition, the FDIC’s proposed classification of fintech-bank accounts as de facto “brokered” is not supported by the FDIC’s own rationale which is grounded in unrelated bank failures. 
Comments are due to the FDIC by October 22, 2024. 

IPA Mentions

• Digital Transactions: Payments 3.0: Humanity And the War on Gift Card Fraud – Digital Transactions
  
• IPA Op-Ed: Brokered Deposits (Amer. Banker pay wall) 
  
• IPA Pod: September 2024 Government Update

Articles and Reports

• • Digital Transactions - July: Can Fintechs Control Their Destiny
  • Digital Transactions - June: Time for Second Thoughts on Fintechs 

 
Upcoming Events and Calls 

Events

• Save the Date: Money 2020 Reception - Oct. 29, 2024
  
  

GRWG Calls

• IPA October Monthly GRWG Call: October 17, 2024
• IPA November Monthly GRWG Call – November 14, 2024

​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​is issued by the Innovative Payments Association twenty times a year as a service to members.
Editors: Brian Tate, President and CEO, IPA; Ben Jackson, COO, IPA;  Eli Rosenberg, Partner, Baird Holm LLP; and Gray Derrick, Partner, Baird Holm LLP. Please address comments and suggestions to: gr@ipa.org.

The IPA's Compliance Boot Camp is coming to Chicago, Illinois, and act fast—37% of the seats have already sold!
Register now to secure your spot at this one-day, in-person event packed with valuable sessions tailored to the payments community. This is the lowest rate you will find for earning up to 6 CLEs. Here's a glimpse of what awaits you:

• Gain insights into recent CFPB enforcement activity and compliance tips from industry experts Matt White and Timothy Butler of Greenberg Traurig.
• Explore the future of Open Banking with Brian Montgomery from Pillsbury and learn how to prepare for the upcoming regulatory changes.
• Stay ahead of the curve with updates on Earned Wage Access services and regulatory implications from Eli Rosenberg of Baird Holm LLP.
• Navigate the legal complexities of providing banking services to cannabis companies with insights from Brian Axel.
• Understand the importance of third-party oversight and its impact on both Banks and FinTechs with Joyce Mehlman from iLEX.
• Dive into the regulatory and legal landscape surrounding Artificial Intelligence in the financial services industry with K.C. Halm from Davis Wright Tremaine LLP.

Podcasts, Press, and Education
IPA Mentions:

• IPA Blog: Business is Personal 
• IPA Pod: The CFPB is Here to Stay 
• IPA Blog: Cybersecurity is as Much About Culture as Tech
• IPA Op-Ed in Payments Dive – CFPB Should Reconsider the Prepaid Rule
• IPA Pod: The Next Generation of Fintech 
• IPA Blog – EWA Report Only Tells Have the Story

• IPA Pod: The Company in Everyone’s Wallet
• IPA Book Club: Going Infinite

 Upcoming GRWG Calls 

• IPA Weekly GRWG Call: June 10, 17, 24
• IPA June Monthly GRWG Call – June 10, 2024
• IPA July Monthly GRWG Call – July 11, 2024

​On May 16, 2024, the U.S. Supreme Court released its opinion in CFSA v. CFPB. The case focused on whether the CFPB’s current funding structure is constitutional.  You can read a copy of the Court’s Opinion here.  Below is the Court’s holding in the case: 

• Held: Congress’ statutory authorization allowing the Bureau to draw money from the earnings of the Federal Reserve System to carry out the Bureau’s duties satisfies the Appropriations Clause. Pp. 5–19, 22. 
  
  

(a) Under the Appropriations Clause, an appropriation is a law that authorizes expenditures from a specified source of public money for designated purposes. 
 
(1) The Bureau’s funding is “drawn from the Treasury” and is therefore subject to the requirements of the Appropriations Clause. The issue is whether the Bureau’s funding mechanism constitutes an “Appropriatio[n] made by Law.” The Court concludes that the answer is yes based on the Constitution’s text, the history against which that text was enacted, and congressional practice immediately following ratification. Pp. 5–15
 
To learn more about the decision and its impact on the payment’s community please listen to the IPA’s Podcast episode entitled, “The CFPB is Here  to Stay.” 

Text of California EWA Regulation Released
In May, the California DFPI released the text of its EWA Final Rule. A copy of the final rule can be found here (see section on Income Based Advances). At first glance, similar to the proposed rule, the final rule continues to categorize EWA services as loans.  In addition, the final rule still requires EWA providers to register with the state.  However, if an EWA provider registers with the state, the EWA provider is exempt from the fee restrictions and rate caps normally imposed on lenders in the state of California. DFPI also posted a Final Statement of Reasons in which the agency outlines their reasoning for removing the fee restrictions and fee cap restrictions.  However, it is important to keep in mind the DFPI does not foreclose the possibility of the imposition of fee caps and/or fee restrictions in the future. 

You may recall that the State of California Office of Administrative Law rejected the California Department of Financial Protection and Innovation’s submission of the agency’s EWA final rule.  Please note that DFPI will have to address the issues raised by the OAL when it rejected the DFPI’s submission.  Thus, it is still possible parts of the final rule could change after DFPI makes amendments.  
 
Lastly, as a reminder, the IPA filed three comments in response to the proposed rule (and amendments).  You can find a copy of the letters the IPA filed with DFPI in response to their EWA proposals here: https://www.ipa.org/ewa.html
 
CFPB Finalizes Rules for BNPL
Just before Memorial Day 2024 the CFPB issued an interpretive rule that confirms that Buy Now, Pay Later providers are credit card providers. Thus, BNPL providers must follow the regulations that apply to conventional credit cards. These include a right to dispute charges and demand a refund from the lender after returning a product purchased with BNPL. Today’s release outlines how BNPL products meet the criteria for credit card providers, under TILA. As a result, BNPL providers must:

• Investigate disputes: Buy Now, Pay Later lenders must investigate disputes that consumers initiate. Lenders must also pause payment requirements during the investigation and sometimes must issue credits. 
• Refund returned products or cancelled services: When consumers return products or cancel services for a refund, Buy Now, Pay Later lenders must credit the refunds to consumers’ accounts. 
• Provide billing statements: Consumers must receive periodic billing statements like the ones received for classic credit card accounts.

 
The CFPB is collecting comments on this interpretive rule. Comments are due 60 days after the rule is published in the Federal Register.  
 
CFPB Issues Final Rule on Industry Standard-Setting for Open Banking
This morning the CFPB released a rule finalizing in part its proposed rule on consumer data rights under section 1033 of the Consumer Financial Protection Act. This final rule establishes minimum attributes a standard-setting body must possess to receive CFPB recognition and to issue consensus standards when the full rule is finalized. In its October 2023 proposed rule the CFPB proposed that standards adopted by CFPB-recognized standard setters might be used to facilitate implementation of a final Personal Financial Data Rights rule.  The rule will go into effect 30-days after publication in the Federal Register. According to today’s final rule, standard setters must apply to the CFPB and display the following attributes:

• Openness: The CFPB will not recognize any standard-setting organization that is rigged in favor of any set of industry players. The process must be open to all interested parties, including public interest groups, app developers, and a broad range of financial firms with a stake in open banking.
• Transparency: Procedures must be transparent to participants and publicly available.
• Balanced decision-making: The decision-making power to set standards must be balanced across all interested parties, including consumer and other public interest groups. There must also be meaningful representation for large and small commercial entities. No single special interest can dominate the decision-making process.
• Consensus: Standards development must proceed by consensus, though not necessarily unanimity. Comments and objections must be considered using fair and impartial processes.
• Due process and appeals: The standard-setting body must use documented and publicly available policies and procedures, provide adequate notice of meetings, sufficient time to review drafts and prepare views and objections, access to views and objections of other participants, and a fair and impartial process for resolving conflicting views. An appeals process is also available for the impartial handling of procedural appeals.

 
The IPA will continue to review and analyze the final rule. If you have any questions, please contact Brian Tate (btate@ipa.org). 
 
FDIC Consumer New - Banking with Third-Party Apps
On the last day of May the FDIC posted a newsletter focused on consumer’s who use banking apps to conduct their retail banking.  In brief, the newsletter outlines the differences between banking directly with a financial institution and utilizing banking services through a third party fintech program manager, including when FDIC insurance applies, how to navigate nonbank companies, and how to avoid scams or fake apps.  
 
FDIC Chair to Step Down When Replacement Confirmed
Statement by FDIC Chairman Martin J. Gruenberg
It has been my honor to serve at the FDIC as Chairman, Vice Chairman, and Director since August of 2005. Throughout that time I have faithfully carried out the critically important mission of the FDIC to maintain public confidence and stability in the banking system. In light of recent events, I am prepared to step down from my responsibilities once a successor is confirmed. Until that time, I will continue to fulfill my responsibilities as Chairman of the FDIC, including the transformation of the FDIC’s workplace culture.
 
Prudential Regulators Issue Third Party Risk Guide for Community Banks
In May, the FDIC, OCC, and the Federal Reserve Board issued the following press release announcing their new compliance guide entitled, “Third-Party Risk Management A Guide for Community Banks.” The guide outlines each stage of the third-party relationship and is targeted at community financial institutions. In addition, the guide reinforces the third-party risk management guidance issued by the agencies in June 2023, and please note that the  guidance is not a substitute for the agencies’ prior guidance. If you have any questions, please contact Brian Tate (btate@ipa.org).  
 
IPA Responds to FinCEN RFI 
In late May the IPA filed a comment responding to FinCEN’s CIP RFI.  The deadline to file comments responding to the RFI is TODAY.  As a reminder, FinCEN is seeking comments on the Bank Secrecy Act’s (“BSA”) customer identification program (“CIP”) rule.  The CIP rule requires U.S. banks to collect a taxpayer identification number (“TIN”) from a U.S. person before opening a new account for that person. The RFI requests comments about the potential risks, benefits, and safeguards related to partial collection of SSNs directly from customers and the use of third-party sources to collect customers’ full SSNs.  The IPA thanks the working group for their feedback during the comment drafting process.  A copy of the IPA’s comment can be found here:  https://www.ipa.org/fraud.html
 
IPA Comments on IRS Green Book Proposal on EWA 
Shortly after the release of the President’s proposed Budget for FY 2025 , the U.S. Department of Treasury released the "General Explanations of the Administration’s Revenue Proposals" (also known as the “Green Book).  The Green Book provides an explanation of the Administration's revenue proposals for that specific fiscal year.  Similar to the last two years, this year’s Greenbook again contains a proposal from the Internal Revenue Service (IRS) on the tax treatment of EWA related products (See. p. 232).   Further, the language of this year’s proposal appears to be very similar to the proposals released in prior years.  
 
The IPA responded to the Treasury’s IRS proposal by submitting an unsolicited comment letter to the U.S. Treasury outlining our concerns, including the agency’s mischaracterization of the structure and form of EWA products, and how earned wages are accessed by employees who utilize EWA services.  The IPA is currently engaged in a dialogue with the U.S. Treasury and looks forward to sharing information with the agency regarding the benefits of EWA to millions of American.  A copy of the IPA’s letter can be found here.
 
Interchange State Law Update
Yesterday Gov. Pritzker signed the 2025 IL state budget into law. The new state budget included interchange related provisions to prohibiting interchange on sales or excise taxes and voluntary gratuities in Section 150. The provision, if enacted, would be the first of its kind in the country. The provision was included in the state budget as part of a deal made between leaders in the state legislature and the retailers.  It is not clear at all that this potential change in law will result in any discernable benefit to consumers in the state of IL. 

EWA State Law Update
On May 21, 2024, South Carolina Governor McMaster signed into law the Earned Wage Access Services Act which will require EWA providers operating in the state to register with the state’s Department of Consumer Affairs. The new law also provides exemptions from state lending and other requirements for providers. South Carolina now joins Kansas, Wisconsin, Nevada, and Missouri in establishing a distinct statutory framework for EWAs.

​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​is issued by the Innovative Payments Association twenty times a year as a service to members.
Editors: Brian Tate, President and CEO, IPA; Ben Jackson, COO, IPA;  Eli Rosenberg, Partner, Baird Holm LLP; and Gray Derrick, Partner, Baird Holm LLP. Please address comments and suggestions to: gr@ipa.org.

Register Now for the IPA’s 2024 Innovative Payments Conference – Unlocking the Future of Payments
The IPA’s 2024 annual conference, the Innovative Payments Conference is just two short months away! All members of the IPA are welcome to attend. The IPC, scheduled May 5-7, 2024, will take play at the Grand Hyatt in Washington, DC.  The PIC is the place to immerse yourself in three days of groundbreaking insights, cutting-edge technology, and networking opportunities for payments leaders. Headliners include: 

• FDIC Vice Chair, Travis Hill; 
• Treasury Department, Deputy Assistant Secretary for Financial Institutions, Jeannette Quick; 
• Homeland Security, Cross-Border Financial Crime Center, Brian Davis; 
• U.S. Representative Mike Flood (R-NE); and 
• The Cook Report’s, Amy Walter. 

 
Get your tickets now. To register for the conference, please click here. 

IPA Files Interchange Comment
On January 22nd the Federal Reserve Board of Governors issued a press release announcing they have extended the comment period for their Regulation II  proposal until May 12, 2024. As previously reported the proposal would amend the current debit interchange fee cap downward.  In response to the proposal the IPA filed a comment letter outlining our concerns with the proposal. Specifically, the IPA stated that although the proposal directly applies to financial institutions over $10 billion, the Association is concerned that downward pressure will eventually be placed on financial institutions under $10 billion. The IPA urges other institutions concerned with the proposal to consider filing comments ahead of the comment period deadline. 
 
IPA Files 3rd Comment with DPFI
On February 2nd, the IPA filed our third comment with the California Department of Financial Protection and Innovation.  The IPA’s letter was in response to the DFPI’s Second Modification to its proposed registration requirements for EWA which were initially released in March 2023. The IPA remains concerned that despite three versions of the proposed rule DFPI continues to categorize all EWA products as loans. In addition, the IPA is concerned that DFPI’s proposal appears to be asserting that fees from disbursement devices, such as a prepaid card, may be counted as fees associated with EWA.  The deadline to submit comments to the DFPI was Feb. 6th.   
 
IPA Shares Draft Comment(s) Responding to CFPB’s Proposals on Overdraft and NSF Fees. As previously noticed, on January 17th the Consumer Financial Protection Bureau released its proposed rule on Overdraft Protection services. In brief, the proposed rule would apply credit protections via TILA to overdraft services offered by covered financial institutions. A covered financial institution is a bank with assets of $10 billion or more. Consumers receiving covered overdraft credit from a covered financial institution would receive the loan disclosures required under TILA. Moreover, the protections that apply to traditional credit cards would apply to a covered overdraft credit issued by a covered financial institution that is accessed by debit cards or routing/checking account numbers.  Comments are due to the CFPB by April 1st.
 
Accordingly, later in January the CFPB released a proposal on Non-Sufficient Fund Fees (NSF). In short, the proposal would cover NSF fees when a consumer tries to make a payment but does not have enough money in their account at the point of sale. Further, the proposal would apply to debit card and prepaid card purchases, ATM withdrawals, as well as some declined peer-to-peer payments. Comments are due to the CFPB on or before March 25, 2024. 
 
The IPA has drafted responses to each proposal. The Association also held a conference to review each comment and urges members to review the drafts and send in their comments as soon as possible due to the upcoming deadlines.  
 
Steil Introduces EWA Bill 
U.S. Representative Bryan Steil (R-WI) has formally introduced his EWA bill, H.R. 7428.  It is important to note that H.R. 7428 has been cosponsored by the U.S. Representative French Hill (R-AR). Hill is also the Chairman of the House Financial Services Subcommittee on Digital Assets, Financial Technology and Inclusion.
 
Steil released a  discussion draft last fall before the House Financial Services Committee’s October hearing on fintech.  Accordingly, similar to the discussion draft sought to regulate EWA (Employer and D2C Models), including disclosure requirements, dispute resolution policies, and limitations related to fees. In addition, the bill also has a new section requiring providers who may charge fees (for instance, expedited services) to also make a free version available.  
 
H.R. 7428 was expected to be included in the list of bills marked up by the House Financial Services Committee on February 29th.  However, due to a scheduling change in the House of Representatives, the markup proceeded without reviewing H.R. 7428. The IPA will share with members when the Committee schedules a markup which includes H.R. 7428. 

Hosted by the IPA, the Payments Podcast is designed to keep you ahead of an ever-changing industry and position you to succeed in tomorrow’s payments environment. Join us for thought-provoking discussions on the most pressing issues of the day. Listen to recent episodes below and subscribe using the app of your choice.
 

• IPA Pod: Feb. 2024 GRWG Update
• IPA Pod: Illegal Transactions Hiding in Plain Sight
• IPA Pod: Immediate Uses EWA to Build Financial Health 

 
Upcoming GRWG Calls

• Next IPA Weekly GRWG Call – March 11, 2024
• Next IPA Monthly GRWG Call – March 14, 2024