House Representative Calling for FDIC Public Hearing on SoFi’s ILC Charter Application

SoFi has faced challenges of opposition to its industrial loan charter from numerous parties for various reasons; now California Representative Maxine Waters, a Democrat on the House Financial Services Committee, has written a letter to the FDIC calling for a public hearing to more broadly discuss the online lenders application and its market implications; fintech regulation is an ongoing topic for debate and Waters says, “Granting SoFi’s application would set a precedent that a wide variety of other fintech companies may choose to follow even though concerns related to financial inclusion, consumer benefits, supervision, and regulation of such entities are still unresolved.”; the industrial loan charter would give SoFi a number of advantages including the allowance for FDIC insured deposits with no supervisory reporting requirements at the holding company level; Waters also commented on the development of the OCC’s special purpose national charter for fintech companies which would grant internet lenders nationwide business approval in a single charter, stating that the framework has not been fully developed for implementation; the industrial loan company charter is currently limited to business in the states of California, Colorado, Minnesota, Indiana, Hawaii, Nevada and Utah. Source