Apple will now be treated like a bank

[Animats]

It's not about Apple. It's Apple, Google and Amazon, PayPal, Block, Venmo and Zelle.[1] Everybody with over 50,000,000 transactions annually gets CFPB oversight. Actual rule: [2]

This doesn't really do much. It creates no consumer rights. It does give CFPB examiners the power to examine records and interview people. It means that numbers such as how many PayPal customers have complaints will be looked at. Bank examiners look at error rates, fraud losses, unresolved complaints, and such. The effect will probably be that some of the big players with weak customer service will have to get their act together.

[1] https://www.consumerfinance.gov/about-us/newsroom/cfpb-final...

[2] https://files.consumerfinance.gov/f/documents/cfpb_final-rul...

[pdpi]

> Everybody with over 50,000,000 transactions annually gets CFPB oversight.

This is such a simple, straightforward rule. No weird gotchas, exceptions, or whatever. Just the most basic test you can think of for "are you acting as a financial institution in the most obvious day-to-day sense of the term?" and a reasonably sane (I think?) threshold.

It's also so bloody easy to prepare for. Are you handling 1M transactions anually? No worries, keep doing your thing. Are you handling 20M transactions annually? You probably want to start planning. 40M p.a.? You want to be preempt the moment when you get regulated.

[almostnormal]

Paypal isn't just treated like a bank, it is a bank, at least in the EU.

[JumpCrisscross]

> This doesn't really do much. It creates no consumer rights. It does give CFPB examiners the power to examine records and interview people

Examination power means the CFPB can act on consumer complaints. It’s an enormous practical expansion of power.

[ksec]

I am thinking that would also include Stripe? Or is Stripe not consumer facing? Not that Apple is forced to open up NFC worldwide. I am wondering what would happen next? Surely Apple has incentive to own NFC transaction or something like Apple Cash.

[justinclift]

> The effect will probably be that some of the big players with weak customer service will have to get their act together.

Heh, if PayPal ever gets rid of its reputation for dodgyness, and it also provides reasonable customer service, then it might because a decent option.

[mxuribe]

> ...The effect will probably be that some of the big players with weak customer service will have to get their act together...

Agreed that maybe *explicitly* consumer rights are not added on so to speak...but if you are correct about the effect being improved customer service, i would say that would be a big "consumer rights" win! I'll take that over keeping the status quo of crap customer service.

[asdfasdf1]

that may explain Google's excellent customer service! can't wait for antitrust to split them into million pieces...

[grues-dinner]

It's written like it's a strange thing:

> role is normally limited to banks and financial services companies.

Was anyone expecting a system that handles 6 trillion dollars a year to not fall under financial regulatory purview?

Which I realise is not the actual thrust of the rule change (obviously they were already under some regs already), but it's just such an odd intro.

Apple withdrawing Pay Later when it became clear they'd need to comply with lending regs is quite telling too. Presumably they were attempting to sneak in the back door and claim "it's tech not banking" and got told they're not above the law when the Truth in Lending Act was confirmed to cover the system.

[politelemon]

> Was anyone expecting a system that handles 6 trillion dollars a year to not fall under financial regulatory purview?

9to5mac and Apple at the very least.

[venantius]

As someone who runs an actual bank, the headlines around this story are super misleading. In no meaningful way will be Apple be treated like a bank in the way that we generally expect banks to be treated.

[christophilus]

Yeah. The headline had me thinking of cash reserves, fractional lending constraints, etc.

[bsaul]

A friend of mine , 15 years ago (ios 3), already predicted that the only reason why apple would stash that amount of cash was if they planned on turning into a bank.

Hats off to you, my friend !

[BiteCode_dev]

I said the same thing, and I'm going to do one more prediction: the banking business will become more and more profitable with very low risk to the point it will take more and more space in Apple's culture.

Also, regulations and the hiring market mean they will have to hire more and more profiles than you typically find in finance. With Jobs dead and an aging Cook that can't willpower himself into everything anymore, nothing will cancel this effect.

Eventually, this will lower Apple taste for innovation and the product quality will go down until they become another average player cashing in on the inertia of its past success.

They will be super profitable, but nobody will look up to them anymore.

[ozim]

It seems like they did not plan turning into a bank because that would be introducing annoying regulations - but the regulators turned them into a bank.

[matwood]

At a certain size every company becomes a bank. Once a company can do its own banking like things it doesn’t make sense to pay anyone else. It’s somewhat like rich people who can self insure.

[rsync]

No, I I think it’s the opposite.

There is some threshold of financial assets after which there is nothing to do but become a bank.

[walterbell]

Data and identity custodians become money custodians, and vice versa. U.S. CFPB requires that banks export personal data when authorized by consumers, laying the groundwork for commercial data vaults. Could a Personal Data Vault on Mac Mini be connected to Apple Private Cloud Compute (PCC) LLM?

https://www.consumerfinance.gov/about-us/newsroom/cfpb-final...

> The rule requires financial institutions, credit card issuers, and other financial providers to unlock an individual’s personal financial data and transfer it to another provider at the consumer’s request for free.. Consumers will be able to access, or authorize a third party to access, data such as transaction information, account balance information, information needed to initiate payments, upcoming bill information, and basic account verification information. Financial providers must make this information available without charging fees. The rule moves the United States closer to having a competitive, safe, secure, and reliable “open banking” system.

Will Facebook return to the digital currency business? https://en.wikipedia.org/wiki/Diem_(digital_currency)

[Animats]

> Will Facebook return to the digital currency business?

Good question. Probably not, especially after this. If you handle other peoples' money, you have legal responsibilities. Facebook hates that.

[impish9208]

Previously: https://news.ycombinator.com/item?id=42203655

[yieldcrv]

If I was a betting man, which I am, I wouldnt draw attention to myself if I was the CFPB

[bell-cot]

Perhaps. OTOH, I've seen a number of stories about some Republican politicians noticing that they're now the party of the "ordinary working people", and trying to play that part.

[HeatrayEnjoyer]

Do you mean Apple? Your comment is unclear as-is.

[CodeCompost]

  Apple will now be treated like a bank

As in ... to big to fail?

[Andrex]

If anything, Apple will be bailing the Fed out.

[Traubenfuchs]

I am surprised by all those "you are not above the law and you can not do what you want" rulings lately, e.g. USA wanting to separate Google and Chrome. Everyone always says lobbyists and corruption rule the US and only the EU puts up a little fight against big tech (e.g. GDPR) but here are refreshing counter examples.

[smallerfish]

It doesn't take very much observation of the US political system to realize that one party is generally quite good at government (although sadly is much worse at politics), while the other tends to have a higher rate of corruption and generally wants to reduce regulatory power to a minimum to benefit the corporate sector.

[jajko]

I work at a bank (not US one though). Good luck with little everchanging regulation hell all banks are continuously exposed to, it keeps hefty dedicated departments alive and well across whole industry.

[palata]

> Good luck with little everchanging regulation hell all banks are continuously exposed to, it keeps hefty dedicated departments alive

Isn't it the whole game? New regulations try to prevent banks from abusing, and in return banks try to abuse the new regulations?

Banks wouldn't do it if it wasn't profitable, right?

[pyrale]

> Good luck with little everchanging regulation hell all banks are continuously exposed to

Banks would have less regulation if they handn't fucked, quite litterally, the entire world less than 15 years ago.

[metalman]

Money is a human construct, and like its cousin the easter bunny, conforms to an arbitrary set of rules, and valuable things are created outbof thin air. Dont beleave me, well then, next spring, walk thee down to a bustling day care center and seek the sage advice of one of the owl eyed littles , who should they discover your lack of understanding, will, should they see your need, fill you in on the phenominon of the easter bunny. In fact the whole banking industry should be listened too, as if it has a soft pallet, and while earnest, isn't ready to be in charge of anything.