By Brad Birkholz, Senior Manager and James Siegel, Senior Manager Plante Moran Third-Party Relationships: Due Diligence Guidance for Community Financial Institutions Engaging Fintechs New federal guidance has clarified steps community financial institutions should take when contracting with a financial technology service provider. Banks that rely on fintechs, and those considering new relationships, should take time to understand the expectations. Today’s community financial institutions see more opportunities than ever to enter into relationships with a new generation of financial technology (fintech) companies, including those offering robotic process automation solutions. Community financial institutions are no strangers to engaging technology companies that assist with various business needs – such as core systems and IT infrastructure – but these next-generation fintech partnership opportunities present new risks because the products and services they offer are new to the marketplace. Until recently, the regulatory guidance governing third-party risk management expectations for financial institutions has been spread across several different federal agencies. Fintech relationships are often (although not always) customer-facing partnerships. They enable community financial institutions to provide a new product or service, access a new customer base, or enhance efficiencies. www.coloradobankers.org 6
RkJQdWJsaXNoZXIy MTU2Mjk4Mw==