White House sets forth fintech framework for United States

The White House National Economic Council has published a white paper, titled “A Framework for FinTech”, which expresses the forward-leaning posture of the administration to innovation and entrepreneurship, generally, and fintech in particular.

The need for a fintech framework was first discussed at the White House FinTech Summit in June 2016.  At the event, Cabinet Secretaries and senior officials from across the administration engaged with stakeholders about the potential for fintech to further myriad policy goals, including small business access to capital, financial inclusion and health, domestic growth, and international development.

The white paper sets forth administration policy objectives that reflect widely-shared values and practical expectations for the financial services sector and the U.S. government entities that interact with the sector. It also provides ten overarching principles that constitute a framework policymakers and regulators can use to think about, engage with, and assess the fintech ecosystem in order to meet these policy objectives.

The ten principles encourage stakeholders to:

1. Think broadly about the financial ecosystem;
    
2. Start with the consumer in mind;
    
3. Promote safe financial inclusion and financial health;
    
4. Recognize and overcome potential technological bias;
    
5. Maximize transparency;
    
6. Strive for interoperability and harmonize technical standards;
    
7. Build in cybersecurity, data security, and privacy protections from the start;
    
8. Increase efficiency and effectiveness in financial infrastructure;
    
9. Protect financial stability; and
    
10. Continue and strengthen cross-sector engagement.

“This whitepaper is both a product of ongoing public-private cooperation and a roadmap for future collaboration. As the fintech ecosystem continues to evolve, this statement of principles should serve as a resource to guide the development of smart, pragmatic, and innovative cross-sector engagement”, the white paper reads.

Speaking of future course of action, the document says that the U.S. should continue developing a policy strategy that helps advance fintech and the broader financial services sector, achieve policy objectives where financial services play an integral role, and maintain a robust competitive advantage in the technology and financial services sectors.  In addition, policymakers, regulators, and the private sector should continue engaging with one another to foster innovation in fintech while protecting consumers and the financial system.