Fintech holds great promise to expand credit, Federal Reserve Vice Chair for Bank Supervision Randy Quarles told a forum on financial services for the underserved Monday. “(Fintech) may enable credit to be underwritten and delivered in a manner that is still prudent but with greater efficiency, convenience, and lower processing costs,” Quarles forecast in prepared remarks. Touching on another issue, Quarles said the decline in lending by small banks to small businesses can be attributed in part by entrepreneurs using big bank credit cards. However, he acknowledged this avenue of credit is more expensive and less flexible than traditional bank loans. “Personal or business credit cards may be suitable for purchasing supplies, but not for payroll,” the Fed’s Bank Supervision head added.

Source: Forbes March 27, 2018 13:07 UTC