Summary
For United States-based fintechs, compliance isn’t just one more box to be checked in the legal process; done correctly, it can be a strategic advantage. From identity verification and fair lending to data privacy and bank partnerships, understanding the regulatory landscape helps fintechs build trust, scale responsibly and innovate with confidence.
Identity verification and AML screening
The foundation of any fintech compliance program begins with “know your customer” (KYC) protocols and anti-money laundering (AML) screening. These processes verify customer identities and ensure your business isn’t engaging with individuals or entities flagged by government watchlists. Effective KYC and AML practices not only prevent fraud, but also demonstrate your commitment to legal and ethical operations.
Lending fairness and disclosure
If your fintech offers credit products like personal loans, buy now, pay later (BNPL) options or business lines, you must comply with the Equal Credit Opportunity Act (ECOA), which prohibits discrimination. Additional regulations, such as UDAAP/UDAP, Reg Z and ECOA mandate transparent disclosures about interest rates, fees and repayment terms. Clear, equitable practices build customer and partner loyalty while reducing your legal and compliance risk.
Ethical debt collection
When accounts become overdue, the Fair Debt Collection Practices Act (FDCPA) governs how and when you can contact customers. Harassment, deception or excessive contact can lead to fines and regulatory penalties.
Transparent marketing and product disclosures
Marketing is a powerful tool – but it must be honest. Messaging should always clearly communicate product terms and conditions. Misleading claims or hidden fees can trigger regulatory action and erode brand credibility. Transparency isn’t just ethical, it’s essential for sustainable growth.
Navigating bank partnerships
Many fintechs rely on bank partnerships to deliver financial services. Institutions like First Internet Bank are regulated by agencies that include the FDIC and Federal Reserve, State regulations and even the CFPB and FTC, which means in essence, fintechs must meet multiple compliance standards. A robust, well-documented compliance program ensures alignment with both regulatory and partner expectations.
Data privacy and security
Handling sensitive financial and personal data requires strict adherence to laws like the Gramm-Leach-Bliley Act (GLBA) and various state-level privacy regulations. Strong security protocols help protect user data from breaches and misuse. Data protection isn’t just a legal requirement; it’s a promise you make to your customers.
Invest early in compliance
At First Internet Bank, we believe compliance should be built into your business from day one. A strong program includes:
- Dedicated compliance personnel or partners
- Automated monitoring tools
- Clear internal policies and training
- Regular audits and risk assessments
These elements don’t just keep you compliant, they build credibility with bank partners, customers, investors and regulators.
Final thoughts
Compliance may seem complex, but it doesn’t have to be overwhelming. With the right strategy and support, fintechs can meet regulatory requirements while continuing to innovate. First Internet Bank is proud to support the next generation of financial technology with insights and infrastructure that help you grow responsibly.
We work directly with your team to deliver seamless integration, a strong balance sheet, dedicated partnership team and operational oversight. From Bank Secrecy Act (BSA) compliance to helping you deliver industry-approved products, you can count on your First Internet Bank fintech partners to help you Imagine More.
