A: The market delivers what consumers demand and technology enables. Many customers have determined they want the bespoke experience of tailored apps and boutique service providers instead of financial supermarkets. That is driving some servicers out of one-stop shops and onto specialty fintech platforms. At the same time, technology is enabling a decentralization of services in the same way that the publishing process became universally accessible after the expansion of the Internet. I described the forces at length in a recent issue of International Banker.1
These are tectonic forces, which really can’t be resisted, but they can be framed and managed. Industry participants and regulators need to shift their perspectives to understand how risks change when moving from relatively few monolithic service providers to very many providers satisfying particular needs and functions within the markets. There is great strength in greater consumer choice, diversity and lack of concentration, but we need to understand the interconnectedness and discreet risks in this new operating environment. OCC examiners are well-prepared to regulate and supervise emerging risks wherever they are located in the national banking sector.
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