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The Conference of State Bank Supervisors (CSBS) will on Tuesday
unveil the new regulatory regime for money services businesses,
which will undergo a single exam by a joint group of state
regulators that oversee licensing, instead of dozens of
individual state exams.
The new streamlined regime applies to 78 large payment and
cryptocurrency firms, which combined move over $1 trillion
annually. It aims to make it easier for companies to operate
across multiple states, the CSBS told Reuters.
State regulators have been working together in recent years to
address company complaints that the state-by-state supervisory
system is redundant and overly burdensome. Crypto-currency and
fintech firms, which typically have to be licensed state by
state have been particularly vocal about the problem.
Under the new arrangement, a group of examiners from a handful
of states will jointly supervise a business, instead of each
individual state.
John Ryan, CSBS's president and CEO, said the new approach will
be just as robust, but more efficient. States will be able to
share information from the exams, and each state will reserve
the right to launch independent examinations if they want.
"The states aren't giving up authority. They're realizing
efficiencies by sharing information," he said in an interview.
Rosemary Gallagher, associate counsel for Western Union, which
participated in a pilot program last year, said the company
previously faced dozens of individual state exams and that they
expected that repetition to be reduced.
She added that the new regime would reduce the burden for each
individual state too, allowing them to field their "highest
quality examiners."
(Reporting by Pete Schroeder; Editing by Michelle Price and
Aurora Ellis)
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