Cross River Bank (“Cross River”), a leading technology infrastructure provider that offers embedded financial solutions, yesterday joined with California State Senator Monique Limón (D-CA), Assemblyman Tim Grayson (D-Concord), the Department of Financial Protection and Innovation (DFPI) and Tom Curran, Chief Risk and Compliance Officer at one of Cross River’s innovative partners, Upgrade, to discuss California’s consumer lending landscape, how AB539 sets the parameters for responsible lending, and how responsible bank-fintech partnership model propels innovation, protects consumers, and expands access to credit and financial inclusion.
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“California is creating an innovative environment and regulatory structure that will allow fintech innovators to thrive”
Under the leadership of Senator Monique Limón and Assemblyman Tim Grayson’s, and in alignment with Governor Newsom and his Administration’s priorities, California is leading the way in promoting an innovative ecosystem where modern financial services can thrive, while ensuring the highest levels of consumer protection and regulatory compliance. Cross River is reshaping and powering the future of global finance by creating access to safe and affordable financial services for communities historically unbanked and underbanked, maintaining the highest level of consumer protection and regulatory compliance.
“California is creating an innovative environment and regulatory structure that will allow fintech innovators to thrive,” said Phil Goldfeder, Senior Vice President of Public Affairs at Cross River. “Fintech innovators are already providing access to safe and affordable financial services to communities long forgotten by the traditional banking system, and I thank Senator Limόn and Assemblyman Grayson for their partnership and advocacy to ensure Californians have the services they need without having to comprome on their consumer safety.”
“Since enactment of my consumer protection legislation in 2019, I have been encouraged by lenders who are willing to comply with the spirit of the law and provide fair access to credit to California consumers,” said Senator Monique Limón (LD-19). “Whether these loans are offered by non-bank lenders, through responsible bank partnerships, or directly from banks themselves, I welcome options for consumers that are affordable, transparent, and that help to improve the financial health of families.”
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“It is fitting that California, as a global hub for technology, continues to lead the way in fostering fintech innovations that improve economic outcomes for our residents,” said Assemblymember Grayson (LD-15). “I believe our financial environment can be safer and more efficient for everyone without jeopardizing economic growth or financial inclusion, and it’s wonderful to work with organizations like Cross River who share that belief.”
In 2019, California Governor Gavin Newsom signed into law AB539, the Fair Access to Credit Act, to crack down on high-interest lenders while supporting the growth of the fintech sector in the state. The Bill placed a maximum rate of 36%, plus the Federal Funds rate, on loans of $2,500 or more but less than $10,000 that under current law have no rate limitations. Other changes included a minimum loan term of 12 months to promote reasonable repayment schedules and a requirement that prior to disbursing loan proceeds credit score resources be provided to consumers to assist them in better understanding the importance of a credit score and how it can be improved.
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