Here is the problem: we made new ideas in banking de facto illegal. Especially since the 2008 financial crisis, regulatory bodies (especially the CFPB) has piled on a huge amount of potential liability that scares away any new entrant. Don’t believe me? Let’s look at the data:
Notice anything about new bank creation in the US after 2008?
A possible explanation, in a “helpful resource” provided to banking regulators and lawyers for banks:
This shows: 8 federal agencies reporting to the FSOC, plus another independent regulatory body for fintech (OFAC/FinCEN). Also, the “helpful” chart notes state regulations just as an addendum in a circle…probably because it would take 50 more, possibly complex and contradictory charts.
So, my fellow citizens, don’t innovate in banking. No one else is, but they are probably right.