FDIC Clarifying Supervisory Approach to Institutions Establishing Account Relationships with Third-Party Payment Processor / FIL-41-2014

The FDIC issued a clarification in 2014 regarding its supervisory approach to institutions establishing account relationships with third-party payment processors (TPPPs). The FDIC stated that as part of its regular safety and soundness examination activities, it reviews and assesses the extent to which institutions having account relationships with TPPPs follow the outstanding guidance.

“The focus of the FDIC’s supervisory approach to institutions establishing account relationships with TPPPs is to ensure institutions have adequate procedures for conducting due diligence, underwriting, and ongoing monitoring of these relationships. When an institution is following the outstanding guidance, it will not be criticized for establishing and maintaining relationships with TPPPs. It is the FDIC’s policy that insured institutions that properly manage customer relationships are neither prohibited nor discouraged from providing services to any customer operating in compliance with applicable law.”

Read the full guidance

Source Regulation