The Federal Deposit Insurance Corporation (FDIC) proposed a new rule requiring banks to maintain more detailed records for customers of fintech apps following the failure of Synapse Bank. The rule aims to ensure transparency and accountability in partnerships between banks and fintech firms, particularly regarding customer funds.
on Tuesday proposed a new rule forcing banks to keep more detailed records for customers of fintech apps after the failure ofThe rule, aimed at accounts opened by fintech firms that partner with banks, makes the institution maintain records of who owns the account and the daily balances attributed to the owner, according to an FDIC memo.
Keeping better records would allow the FDIC to quickly pay depositors in the event of a bank failure, and if the fintech provider fails, it would also help a bankruptcy court determine who is owed what, FDIC officials said Tuesday in a briefing.
FDIC Fintech Synapse Bank Bank Failure Customer Protection
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