The American Fintech Council (AFC) has responded to the Financial Crimes Enforcement Network’s (FinCEN) Request for Information (RFI) concerning the Customer Identification Program (CIP) Rule. The AFC is urging FinCEN to extend current CIP credit card exemptions to Buy-Now-Pay-Later (BNPL) companies and calls for formal rulemaking to ensure uniformity in consumer protection and industry parity.

Phil Goldfeder, Chief Executive Officer of the AFC, emphasized the need for regulatory modernization. “Appropriate regulatory modernization will level the playing field for responsible innovators who are creating critical access to safe and affordable credit options,” Goldfeder stated. He highlighted that CIP Rule reform would enhance consumer safety and create parity among financial products.

In their latest letter, the AFC advocated for a unified regulatory environment for product and service offerings. They requested clarity on collecting partial Tax ID Numbers (TIN) or Social Security Numbers (SSN) directly from consumers while using third-party sources to verify full SSNs through risk-based identity verification procedures.

Ian P. Moloney, Head of Policy and Regulatory Affairs at AFC, wrote in his response to the RFI, “Regulators should pursue a unified regulatory environment for product and service offerings that are provided to consumers for a similar purpose or in a similar manner. As the RFI recognizes, amendments to the CIP Rule Requirements should strike the right balance between ensuring consumer safety and improving the user experience.”

The call for clarity follows an April 2023 letter from AFC to then FinCEN Acting Director Himamauli Das, which identified growing disparities in data collection requirements. The AFC has since engaged with FinCEN on multiple occasions advocating necessary changes.

FinCEN acknowledged public interest from banks, trade associations, and Congress regarding SSN collection requirements in their RFI. They noted expressed interest in allowing banks to collect partial SSNs while utilizing reputable third-party sources to obtain full SSNs before account opening.

Moloney concluded his letter by stating that formal rulemaking by FinCEN would align supervisory expectations between federal regulators and ensure parity among similarly situated financial products.

Read AFC's response letter here.

Read AFC's April 2023 letter here.