Press Releases

WASHINGTON D.C. — Today, Congressman French Hill (AR-02) delivered the keynote address at the Innovative Payments Association annual conference held in Washington, D.C. (pictured below). Congressman Hill has been focused on strengthening financial technology and appreciates the Congressional support by House Financial Services Chairwoman Maxine Waters (D-CA) and Ranking Member Patrick McHenry (R-NC) to promote financial innovation. 

Highlights of his remarks, as prepared, are included below:

Strong History Working in FinTech
The landscape for financial services has changed substantially. Between 2010 and 2017, more than 3,300 new technology-based firms were founded. This growth has coined the term, “FinTech” which may be a new catchy, buzzword, but I’ve actually been engaged in financial technology innovation since the earliest days of my career.

As a college graduate, in the 1970s, I survived mastering Fortran in a giant university data center. Big data then meant big boxes of cardboard punch cards. I later migrated into learning the BASIC language which enhanced bond portfolio assessments and worked with budget and financial statement consolidation.

In 1980, I was selected to lead the founding of a payments system innovator in Texas founded by nine of the top ten banks in the state. PULSE, an ATM/POS changed the face of the very business-oriented unit banks in the state of Texas as it offered a shared way to attract retail customers across the state and Southwest. Pulse is now owned by Discover. Furthermore, during my recent leadership of a community bank, I was proud to build an online brand and nationally competitive Health Savings Account product through the use of Google Ads.

Creation of FinTech Focus in Congress
These past experiences will be helpful as the House Financial Services Committee has focused on the FinTech industry. Both Chairman Waters and Ranking Member McHenry have underscored the importance new space.

Ms. Waters was quoted in her policy speech on January 16, 2019 stating, “One emerging area the Financial Services Committee will be paying very close attention to is the growth of financial technology, or so-called 'FinTech' firms. As Americans are banking and accessing credit in new ways, it is important that we encourage responsible innovation with the appropriate safeguards in place to protect consumers and without displacing community banks and credit unions.” In response, Ranking Member McHenry requested a hearing on the regulation of FinTech in a letter he wrote to the Chairwoman on January 23, 2019.

In anticipation of the new focus, I’ve been on, what I like to call, a “FinTech fact-finding mission.” I’ve been reading various reports and white papers and have been fortunate to travel to different parts of the country meeting with key FinTech stakeholders. Some of the rewarding visits are with the amazing entrepreneurs and intra-prenuers that are advancing change at incubators and accelerators from Little Rock to Boston. They are classic problem solvers that could be working at a startup or in a sandbox at one of our most successful firms.

I’m sure many in this room are familiar, but the Treasury Department issued their “Nonbank financials, FinTech and Innovation,” report last summer. It’s a comprehensive report that outlines recommendations and suggestions for ways to maintain and enhance America’s financial technology competitive edge. After reading the report and speaking with various stakeholders, common FinTech themes keep rising to the surface that I hope will lead our discussion.  

These common themes center around federal legislative and regulatory approaches that are necessary to foster innovation for both disruptive innovators and incumbent financial players. The ultimate beneficiary is the American consumer. We want to encourage innovation among RegTech, FinTech, InsureTech, InvestTech and any other “tech” I might have missed, with an eye toward better consumer experiences and a lower cost of compliance.

Obviously, payments, business, and consumer lending, along with investment and insurance dominate the FinTech industry. But it also includes the future of blockchain and use of tokenization. As you can see, it’s a broad area and your views are key as Congress develops its priorities.

FinTech Payments Strategy
Specifically, as it relates to the payments industry, I know we’ve been having ongoing conversations about a variety of different issues. Recently, I was in Atlanta to meet with many of the payment’s stakeholders. In fact, many of the people I met were with are in the audience today, including Robert Skiba with InComm, who currently serves as your Chairman.

From my time starting PULSE, technology has infinitely advanced the payments industry. Innovations spanning the spectrum from incumbents to FinTechs are reshaping the payments landscape, boosting customer expectations, and intensifying competition globally. The payments industry is attracting more growth and investment than ever before. For example, in 2017, payments received $2.7 billion in venture capital and increased over seven times to more than $15 billion for just the first half of 2018.

One final area that is especially relevant today, includes the need for the U.S. to develop a solution for the payments industry that would facilitate real-time settlement–as encouraged by the Treasury FinTech report. Such a system would create a level playing field for all financial institutions to access innovating technologies and payment services.

If America wants to remain relevant and competitive in this industry, we must act soon. The Treasury report recommends the Federal Reserve lead the charge in creating a faster payment system. The Fed responded by inviting public comment on this type of system. Comments were due in December and the final rule has not yet been released.

I hope to work with both the Treasury and the Federal Reserve as part of my role in Congress to find a workable solution that will benefit all financial institutions. America has the greatest financial industry in the world and I look forward to working with Congress to making sure this continues.