OCC, FDIC part ways on forcing banks to fix cyber gaps

Banks and financing partners are facing a split in how regulators enforce cybersecurity. A new rule taking effect November 2 shows a growing gap between the FDIC and the OCC. For retailers, this means the 'compliance health' of your lending partner now depends heavily on which agency oversees them. The FDIC is moving toward a more lenient approach where cyber weaknesses might only result in an informal note if they don't directly threaten the bank's immediate financial solvency. Meanwhile, the OCC remains stricter, treating security gaps as serious operational risks regardless of the balance sheet. This matters for your business because any data breach at the lender level can instantly halt your ability to process customer applications. If your primary lender is FDIC-regulated, they may have more 'wiggle room' in how they handle internal tech gaps, but that could also lead to a slower response to emerging threats. If they are OCC-regulated, expect more frequent audits and potentially higher compliance costs passed down to the merchant level. You should ask your financing providers about their regulatory oversight and how they are addressing these new cybersecurity exam standards to ensure your point-of-sale financing stays online and secure.

Source: American Banker — Top News

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