House Passes Federal Savings Association Charter Flexibility Act

In February 2018, the U.S. House passed the Federal Savings Association Charter Flexibility Act of 2017 (H.R. 1426), a bill enabling federal savings associations to exercise the powers of a national bank without formally converting to a national bank charter. The legislation reduced regulatory friction for savings associations seeking to offer a broader range of banking services, including those commonly associated with national banks.

While not directly targeting fintech companies, the bill expanded charter flexibility in ways that could benefit fintech-bank partnership models and BaaS arrangements. By enabling savings associations to offer fuller banking capabilities, the law opened new possibilities for these institutions to serve as sponsor banks for fintech platforms. The bill also complemented concurrent legislation to facilitate online banking.

The act was part of a broader legislative environment aimed at modernizing the U.S. banking charter system to better accommodate technology-driven financial services. Financial terms were not applicable as this was a legislative action rather than a commercial deal.