CFPB Expands Oversight to Major Payment Firms

The Consumer Financial Protection Bureau (CFPB) has finalized a rule to bring major digital payment providers like Apple Pay, Google Pay, PayPal, and Venmo under its supervision, treating them similarly to banks. This rule applies to companies processing over 50 million transactions annually, allowing the CFPB to conduct proactive examinations to ensure compliance with federal laws on privacy, fraud, and account closures. The move aims to protect consumer privacy, reduce fraud, and prevent illegal account closures, as digital payments have become essential in everyday commerce. Notably, the rule does not extend to self-hosted crypto wallets, a decision praised by blockchain advocates for supporting innovation in decentralized finance. The rule reflects the growing importance of digital payment platforms among middle and lower-income consumers and will go into effect 30 days after being published in the Federal Register. The CFPB's oversight includes the authority to inspect company records, interview employees, and monitor compliance with applicable laws.