Following more than two years of advocacy, the American Fintech Council (AFC) has achieved a significant regulatory milestone. The Federal Deposit Insurance Corporation (FDIC) approved a general exemption to the Customer Identification Program (CIP) rule, with unanimous support from its board and concurrence from FinCEN Director Andrea Gacki. This exemption allows regulated banks more flexibility in verifying customer identities when opening new accounts, including options beyond collecting full Social Security Numbers or Tax Identification Numbers directly from consumers.
The AFC has been advocating for modernizing outdated compliance frameworks to support identity verification methods that expand access without compromising security. Phil Goldfeder, CEO of the American Fintech Council, stated: “We have long championed regulatory modernization, including updating the CIP rule, to create parity for similarly situated financial services and bring requirements in line with responsible innovative practices.”
The decision is seen as a recognition among regulators that rigid interpretations of statutes can restrict access to the financial system without improving security. The exemption provides a risk-based path allowing institutions and their fintech partners to use modern identity verification tools while maintaining consumer protections.
Ian P. Moloney, SVP and Head of Policy and Regulatory Affairs at AFC, remarked: “The FDIC’s approval of the CIP Rule Exemption Order marks a meaningful step forward in modernizing outdated Bank Secrecy Act compliance requirements and expanding access to the financial system – a step AFC has consistently championed for years.”
The AFC represents major fintech companies and innovative banks offering embedded finance solutions. Its mission is to promote a transparent, inclusive financial system by supporting responsible innovation in financial services.