We are providing a series of fintech related presidential election discussions leading up to November 5th. As a follow up to last week’s newsletter on a potential Trump Presidency, we’re examining the potential impact(s) of a Harris administration on our sector.
High-level thoughts on a Harris win.A primary tenant of the current administration would likely continue, which is the championing of consumer safeguards through the Consumer Financial Protection Board (CFPB) and other agencies. For example, Harris initiated a CFPB proposal to remove medical debt from consumer reports and endorsed the agency’s motion to require mortgage servicing providers to help struggling borrowers. Tough interpretation of current rules may imply strict oversight of credit cards, payment companies and fintech related businesses in general. Harris called for an investigation of Wells Fargo in 2016 following the fake account scandal and has been on the record of siding with Senator Elizabeth Warren (D-MA) for more financial institution regulation; she highlighted (rightfully) the failure of the Silicon Valley Bank (SVB) as one recent example of why increased oversight is needed. Harris’s pro-immigration stance should be a net positive for money services businesses (MSBs) which enable cross-border, person-to-person money transfers, particularly to countries south of the border. On crypto, a Harris presidency could prolong regulation by enforcement through the Securities and Exchange Commission (SEC), perpetuating uncertainty in this nascent sub-sector. Net, net we see fintech as a potential beneficiary because the sector is the medium by which information transparency and access to more services is achieved, even at the expense of legacy financial institutions.
