Fintech Firms Want to Shake Up Banking, and That Worries the Fed

A man keeps tabs on the financial markets at the TMX Group in Toronto’s financial district in this file photo. The city is a hotbed for fintech activity that continues to evolve with tools like machine learning. The Canadian Press/Darren Calabrese

WASHINGTON—The U.S. Federal Reserve is wary of giving “fintech” firms such as OnDeck Capital Inc. or Kabbage Inc. access to the country’s financial infrastructure, putting the central bank at odds with other regulators looking to bring them into the fold.

The Office of the Comptroller of the Currency (OCC) and the Federal Deposit Insurance Corporation (FDIC) are exploring granting federal bank-like licenses to tech-driven firms that offer financial services, such as money transfers and lending.