WASHINGTON — Banking is not a “static” business, and must be allowed to evolve, Comptroller of the Currency Thomas Curry said Friday in response to critics of his agency's fintech charter.

“At the heart of the issue is the fundamental nature of the business of banking,” said Curry, speaking at Northwestern University’s Kellogg School of Management just two days after state regulators sued the agency over the special-purpose national bank charter it plans to offer fintech firms.

“The business of banking is dynamic,” Curry said. “And I would urge caution to anyone who wants to define banking as a static state. Such a view risks choking off growth and innovation.”

"We cannot compromise the integrity of the banking system or allow untested products to result in unintended consumer harm," said Comptroller Thomas Curry.

The comptroller also sought to reassure skeptics on the left, who fear the agency could be giving a mandate for predatory or unsustainable business models to operate throughout the country.

“We are paying attention to some warning signs about the performance of assets based on models that have not yet been tested by time and more adverse credit conditions,” Curry said. “We have to be open to responsible innovation but we cannot compromise the integrity of the banking system or allow untested products to result in unintended consumer harm.”

In addition, Curry defended the OCC’s process for advancing the initiative — through a number of public documents detailing the agency’s reasoning and goals, rather than a formal rulemaking process as some critics have sought.

The agency sought public comment through various stages of the initiative, which is “consistent with our core principles of building transparency and maintaining an open dialogue,” Curry said.

Curry noted that the agency's “responsible innovation” initiative went beyond the fintech charter. It also involved the creation of an Office of Innovation, which will help answer the industry’s questions on fintech.

“One of the primary purposes of the office is to support banks, particularly community banks,” he said. “But we are also seeing a great deal of interest from fintech companies that want to learn more about doing business and collaborating with national banks and federal savings associations.”

Office of Innovation staff will be meeting with representatives from fintech companies and banks in “office hours” to be held in May in San Francisco.

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Lalita Clozel

Lalita Clozel covers fintech regulation, anti-money-laundering, cybersecurity and the Federal Deposit Insurance Corp. in American Banker's Washington bureau.