Apple Pay, Google Pay, and other payment systems developed by large tech companies now dominate large parts of e-commerce, person-to-person payments, and CFPB Director Rohit Chpra seeks more transparency and details about consumer protections.
Potential antitrust concerns were also raised by the CFPB.
Chopra stated in a prepared statement that “Big Tech companies are eagerly growing their empires to gain greater insight and control over our spending habits.”
Chopra, who was confirmed as director last month after serving as a commissioner on FTC where he raised concerns about anticompetitive behavior by large technology companies. It’s not surprising that he raised this issue at his confirmation hearing before the Senate Banking Committee.
The CFPB has removed or reduced a number of policies that were put in place by Trump’s administration. The bureau is increasing its staff in anticipation of playing a greater role in regulation and enforcement as it did under the Obama administration.
Technology companies have launched full-featured payment networks and systems over the past decade like AliPay, Google Pay and Apple Pay. These networks are often hardwired to smart devices.
Consumer groups and banks have expressed concern about tech companies setting up their own payment networks. While banks have attempted to compete with Silicon Valley for payments using services like Zelle but have not been able to keep up and have not had the same success as Google or Apple, they are unable to maintain a competitive edge.
Richard Hunt, CEO, Consumer Bankers Association, an industry group representing the nation’s large consumer banks, stated that “since the Bureau was established, a growing portion of banking activity has been occurring outside the purview of leading regulatory agencies, putting consumers at risk and the resilience of the financial system.”
