The CFPB has said that the likes of Apple Pay and PayPal have gained significant market share in recent years as Big Tech blurs the traditional lines that have separated banking and payments from commercial activities. Yet these operators in the payments sphere do not receive the same regulatory scrutiny and oversight as banks and credit unions. The new rule will help the regulator to ensure that the big nonbank players follow federal law just like large banks, credit unions, and others already under its supervision. Initially, the CFPB wanted the rule to cover services that handle more than five million transactions per year. That has been raised to 50 million, meaning it affects seven providers: Apple, Google, Amazon, PayPal, Venmo, Block, and Zelle. "Digital payments have gone from novelty to necessity and our oversight must reflect this reality,” says CFPB Director Rohit Chopra. "The rule will help to protect consumer privacy, guard against fraud, and prevent illegal account closures." The rule - effective 30 days after publication in the Federal Register - will enable the CFPB to supervise the providers in relation to privacy and surveillance, errors and fraud, and debanking.

Financial Technology Association CEO Penny Lee has hit out at the rule, arguing that “it’s not clear what problem" it is solving, calling it "deeply flawed" and predicting it will "lead to less competition, fewer services, and higher prices". "We urge the Bureau to withdraw this rule,” she concludes.