The American Fintech Council (AFC) has expressed strong support for the House Financial Services Committee’s decision to advance H.R. 5317, known as the Community Bank Deposit Act of 2025. The committee approved the bill with a vote of 48-2. The legislation aims to clarify that custodial deposits made through partnerships between community banks and fintech companies are not classified as brokered deposits.
Phil Goldfeder, Chief Executive Officer of AFC, stated, “Community banks and responsible fintech partners work to help families access safe, affordable products every single day. This legislation, and its strong bipartisan support, provides further clarity that gives banks the assurance necessary to continue responsible innovation, provides consumers confidence in their financial decisions, and ultimately strengthens the financial ecosystem by ensuring partnerships can thrive.”
The bill distinguishes custodial deposits from brokered deposits. According to AFC, this distinction is essential for maintaining partnerships that broaden access to affordable financial services through community banks. Before the committee's review of the bill, AFC submitted a letter supporting it and emphasized the need for regulatory clarity in order to reinforce responsible collaborations between community banks and fintech firms.
AFC has called for quick passage of the Act and has committed to working with Congress, regulators, and other stakeholders to promote a financial system that supports innovation and consumer inclusion.
Hayden Cole, Director of Federal Government Affairs at AFC, commented on the importance of regulatory clarity: “Regulatory clarity allows community banks to better serve their customers and compete on a level playing field. By affirming that custodial deposits are stable, transparent, and functionally equivalent to core deposits, Congress is enacting a pragmatic reform that upholds safety and preserves the responsible innovation that consumers seek in their financial services.”
AFC describes itself as an organization representing major fintech companies and innovative banks involved in embedded finance solutions. Its mission is focused on encouraging transparency, inclusivity, customer-centric practices in finance, supporting sound public policy for responsible innovation in financial services.