Fintechs and crypto companies to look for US bank licences

Like any other country, the US has its big four banks, but it’s also got 4,500 smaller banks. And with regulators now focused on encouraging innovation and technology, the way may soon be open for some crypto companies to become banks, according to Reuters. “Financial technology firms and crypto companies are seeking to become state or national banks in a bid to expand their business under the Trump administration that they view as more industry-friendly, according to more than half a dozen industry executives. Between 2010 and 2023, an average of only five new bank charter applications were approved annually by regulators, compared with 144 a year between 2000 and 2007, Barrage and other regulatory lawyers wrote in a recent open letter that made suggestions about streamlining the process,” reports Reuters. “Industry experts believe that the high scrutiny on granting bank charters is a necessary step for financial stability, but they believe the turnaround process for these applications could be faster. Typically, between $20 million and $50 million is required to set up a new bank, two legal sources said. Access to capital and complying with anti-money laundering laws and the Bank Secrecy Act are some of the biggest challenges for firms applying for charters.”