Invela has submitted a comment letter to the Office of the Comptroller of the Currency (OCC) in response to its recent Request for Information on community banks' engagement with core service providers and other essential third-party service providers. Our message is simple: open finance is being held back by a persistent misapplication of traditional third-party risk management (TPRM) frameworks – and community banks are paying the price.
Open finance operates differently from traditional vendor relationships. Consumers – not banks – choose the third-party tools they want to use. In open finance, third parties are consumers' representatives, not banks' vendors. Yet many banks, particularly community banks with limited compliance resources, may feel compelled to treat these consumer-selected third parties as if they were bank vendors. This creates unnecessary friction, slows innovation, and ultimately limits consumer access to modern financial tools.
In our comment letter, we urged the OCC and other prudential regulators to re-center open finance risk management on information security provisions in the Gramm-Leach-Bliley Act, rather than ill-fitting vendor provisions from the Bank Service Company Act or the Federal Deposit Insurance Act. The OCC has already articulated this principle once before – in its 2020-10 FAQs, which correctly emphasized that information security and data safeguarding should be the primary focus when banks interact with intermediaries and other open finance participants.
Reintroducing this clarity through an interagency statement would meaningfully reduce regulatory burden for community banks and unlock greater innovation across the ecosystem. It would also create the conditions for scalable, private-sector solutions – such as accreditation and dynamic risk scoring – to flourish.
At Invela, we are building exactly that: an industry-leading Open Finance Risk Management network that combines standardized accreditation, real-time risk-indicator scoring, and an insurance-backed warranty to help financial institutions of all sizes participate in open finance with confidence.
We commend the OCC for seeking input on these issues and welcome continued engagement with regulators and industry partners. Clear, modernized guidance will help ensure that community banks remain competitive and that consumers can safely access the tools they choose.
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