Technology News and Headlines

Fintech Focused Banking as a Service Is Reshaping Bank Stability and Consumer Expectations : Analysis

Cornell Law professor Dan Awrey released a working paper titled "Banking, Technology, and Instability" analyzing fintech‑driven Banking‑as‑a‑Service (BaaS). The paper argues BaaS flips traditional outsourcing, with fintechs delegating core banking functions to partner banks, creating regulatory arbitrage. This shift destabilizes bank business models and fuels consumer uncertainty about deposit protections, potentially amplifying run risks. Awrey proposes policy options ranging from stricter record‑keeping to redefining the regulatory perimeter.