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On March 16, 2022, the Consumer Financial Protection Bureau announced an expansion of its unfair, deceptive, or abusive acts or practices (UDAAP) enforcement authority to cover discrimination in noncredit financial products, including deposits and payments. CFPB examiners will review algorithmic models, demographic data, and anti-discrimination processes at supervised institutions. This has direct implications for BaaS and bank-fintech partnerships, as many sponsor banks enable fintech partners to offer deposit accounts, payment services, and other noncredit products. Banks partnering with fintechs are expected to ensure their partners' models and processes do not result in discriminatory outcomes. The guidance signals heightened supervisory attention to fair lending and fair access issues in the broader fintech ecosystem.

Verified from source: On March 16, 2022, the CFPB announced it will leverage its UDAAP authority to prohibit discrimination in noncredit consumer financial products and services, including deposits, payments, remittances, collections, servicing, and consumer reporting, and updated its UDAAP exam manual accordingly.