The Federal Deposit Insurance Corporation (FDIC) is working with banking and fintech industry groups to create an independent standard-setting organisation aimed at improving how banks assess fintech companies and other third-party service providers.
Under a draft term sheet dated July 21, 2026, the proposed organisation would establish baseline standards to determine whether fintechs and other vendors meet federal regulatory and risk management expectations. It would also provide certification against those standards, while independent assessors would conduct compliance reviews.
The objective is to reduce duplication in third-party due diligence, particularly for community banks that may have limited resources to repeatedly assess the same technology providers. Standardised information could be evaluated once, periodically refreshed and then reused by multiple banks.
However, certification would not eliminate banks’ individual responsibilities. Each institution would remain accountable for its own risk assessment, contractual decisions, system integration, ongoing monitoring, regulatory compliance and oversight of third-party relationships.
Participation in the proposed framework would also be voluntary. Banks and fintech companies choosing not to use the standards would not face penalties, while banks using certified providers would not receive a regulatory safe harbour or exemption from supervisory scrutiny.
The FDIC is reportedly expected to provide some seed funding for the new organisation. Industry groups involved in discussions include the American Bankers Association, Independent Community Bankers of America, Bank Policy Institute, Financial Technology Association, American Fintech Council and Coalition for Financial Ecosystem Standards.
The initiative has gained additional significance following the collapse of banking-as-a-service provider Synapse Financial Technologies in April 2024. The failure prevented customers from accessing up to approximately $90 million in funds. The Consumer Financial Protection Bureau later agreed to distribute around $46 million from its civil penalty fund to affected consumers who had been unable to recover their money.
Although renewed discussions have accelerated following the Synapse failure, the idea of an independent standard-setting body for fintech providers is not new. A similar concept was considered during the first Trump administration but was not implemented.
The proposed body remains at an early planning stage. The FDIC and participating industry groups had only recently begun formal discussions as of early August 2026, while the Office of the Comptroller of the Currency (OCC) was also expected to join the initiative.
If implemented, the framework could help bring greater consistency to third-party risk management, reduce onboarding costs and improve regulatory visibility across bank-fintech partnerships, while preserving banks’ ultimate responsibility for managing risks associated with external service providers.
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