FDIC Moves to Create Standards Body for Bank-Fintech Partnerships
Banks must independently vet fintech and other third-party providers for cybersecurity, compliance and operational risk, often repeating work already performed by peers. The burden falls heavily on community lenders with limited specialist staff. The April 2024 collapse of banking-as-a-service intermediary Synapse Financial Technologies, which left customers unable to access as much as about $90 million, sharpened scrutiny of vendor oversight. The Consumer Financial Protection Bureau later agreed to distribute $46 million to some affected consumers.
A July 21 draft term sheet shows the Federal Deposit Insurance Corp. working with six trade groups to create the Banking Industry Standards Development Organization, or BISDO, and a voluntary certification program. Independent assessors would test providers against reusable baseline standards, while banks retain responsibility for institution-specific reviews, monitoring and compliance. The plan was reported on Aug. 5 and remains at an early stage. The FDIC may provide seed funding, though no amount or launch date has been disclosed, and certification would confer no regulatory safe harbor.
All Coverage
2 original reportsThe Backstory
The history behind this eventFDIC Plans Independent Body to Certify Bank Technology Vendors
US banks remain responsible for vetting fintech companies, core processors, cloud platforms and other third parties before entering partnerships. That obligation can weigh disproportionately on community banks, which have fewer compliance staff and must often repeat similar reviews of the same vendors. A common certification framework could lower due-diligence costs, speed technology adoption and help smaller lenders compete without shifting accountability away from bank management.
As of August 2026, the Federal Deposit Insurance Corporation is working with banking and technology industry leaders to create an independent standards body that would set benchmarks and certify banking service providers. The effort revives an initiative opened for public comment on July 24, 2020, covering standard setting and voluntary certification. Banks could use the credentials when assessing vendors, though certification would supplement, rather than replace, their own third-party risk controls.
Subscribe to Mark Radar Weekly
Every Friday, the week's strongest signals in your inbox. Unsubscribe anytime.
If you search news on Google, you can set Mark Radar as a preferred source—our coverage will show up more often in your results. Set as preferred source on Google →