The freshly launched financial innovation network designed to enhance coordination among federal and state regulators likely won’t “materially change anything” until the sandbox-opposing state attorneys general sign on, said McGlinchey Stafford Attorney Robert Savoie.
The Consumer Financial Protection Bureau (CFPB) announced Tuesday that it is working with seven state regulators to form the American Consumer Financial Innovation Network (ACFIN). The initial ACFIN members are the attorneys general of Alabama, Arizona, Georgia, Indiana, South Carolina, Tennessee and Utah.
However, the 21 states that previously opposed the CFPB’s innovation sandbox rules – designed to promote innovation at financial institutions – have yet to sign on, despite invitations to join the network. “The opposition is still something companies need to be cognizant of,” Savoie warned.
The network was established to address hurdles for financial institutions’ tech innovations created by inconsistencies between state and federal regulation. “ACFIN will provide a platform for federal and state regulators to coordinate with each other as they develop new rules of the road and apply existing ones,” CFPB Director Kathleen Kraninger said in a statement.
Despite failure to secure the opposing state attorneys general, Savoie called the move “a positive development” that “will hopefully be a springboard for more cooperation.”
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