A top North Carolina leader is joining forces with other states to push for increased protections for users of Venmo, Cash App and other digital payment platforms.
Attorney General Josh Stein expressed his support for the increased protections this week, backing a rule proposed by the Consumer Financial Protection Bureau (CFPB). He said the protections would put the digital payment services at the same security level as banks, credit unions and other traditional financial institutions.
Under the proposed rule, digital payment platforms would be required to:
- Include nonbank financial companies in CFPB supervisory examinations
- Be held to the same level of accountability as banks and credit unions regarding data privacy, funds transfer, and other relevant consumer protection laws
- Consistently enforce federal consumer financial protection laws to promote fair competition
Stein said that expanding the CFPB’s authority would reduce the risk of potential misuse of consumer data, and would require the payment platforms to tell users how their data is being used while giving them an option to opt-out of information sharing.
“More and more North Carolinians are conducting business on Venmo and other digital payment platforms, and they need to be able to trust that their money is going where they want to spend it,” he said in a press release. “These digital payment platforms need to be playing by the same rules so that people’s hard-earned money is protected.”
Stein also said funds in traditional banks and credit unions are secured by the Federal Deposit Insurance Corporation (FDIC), but money held by standalone person-to-person digital payment services are not. He argued that makes users more susceptible to scams and other money risks.
Stein, along with attorneys general of 17 other states and the District of Columbia, expressed his support through a letter to the CFPB earlier this week.