Fair Access to Banking Act

Summary#

This bill, the Fair Access to Banking Act, would change several federal banking laws to limit when large banks, credit unions, and payment networks can cut off customers. It sets a $10,000,000,000 asset threshold as the main line for larger institutions. Covered banks would have to make the financial services they offer available on proportionally equal terms in their markets. Banks could not deny services to a person unless the denial is based on documented, quantitative, impartial risk standards set in advance, and they must give a written explanation when denying services. Denials may not be based solely on reputational risk. Payment card networks could not block access because of political or reputational risk and could face civil penalties administered by the Comptroller of the Currency. The bill also bars covered large banks or their subsidiaries that refuse to do business with persons who are in compliance with applicable rules from using Federal Reserve discount window lending, the Automated Clearing House network, and certain other services. The bill creates a private civil right allowing people harmed by violations to sue covered banks and seek attorney's fees and treble damages.

What it means for you#

  • Individuals and businesses the bill calls "persons" could be entitled to written reasons if a large bank refuses service, and they could bring a federal lawsuit if they claim a covered bank violated the new rules. Successful plaintiffs could recover attorney's fees and treble damages.
  • Large banks (generally $10 billion or more in assets) would be presumed to be covered and would need to rely on documented, quantitative risk standards when deciding whether to provide services. They could try to rebut the presumption with materials to the Office of the Comptroller of the Currency.
  • Payment card networks and processors could no longer block customers from network services based on political or reputational risk; violating networks could face penalties described in the bill.
  • Credit unions and other depository institutions that meet the size threshold would be included in several of the prohibitions and requirements.

Expenses#

No publicly available information in the bill text about costs, budgetary estimates, or fiscal effects.

Proponents' View#

The bill's findings and purposes state that supporters want to ensure people engaged in activities lawful under applicable rules have fair access to financial services, prevent banks from acting as de facto regulators by denying services for political reasons, and require banks to use impartial, empirical, risk-based standards. The sponsors say large banks enjoy taxpayer support and privileges and should not deny access based on subjective or category-based judgments.

Opponents' View#

No publicly available information in the bill text about opposition views or counterarguments.