WASHINGTON, D.C.— Shayna Olesiuk, Director of Banking Policy, issued the following statement in connection with Better Markets’ new Fact Sheet, “Community Bank Funding Challenges and Opportunities.” 

“Community banks play a central role in ensuring that Main Street can thrive. More than 9 out of every 10 banks in the U.S. are community banks, serving every day American families and small businesses at more than 26,000 branch locations across the country. Their resilience in the face of challenges created by merger pressures, economic downturns, and financial crises makes them an indispensable component of communities across America. However, significant funding challenges are putting this vital resource at risk. 

“Our fact sheet details three main funding challenges facing community banks: 

• Increasing costs of funds; 

• Competition with too-big-to-fail banks and crypto firms; and 

• The growth of unregulated fintechs. 

“We recommend several critical interventions that policymakers and regulators should take now to preserve the stability and integrity of community bank funding, which will enable these banks to continue to thrive and benefit communities across the country. These include: 

• Expanding FDIC deposit insurance to include certain transactional accounts; 

• Strengthening rules related to deposits from bank-fintech partnerships; and 

• Increasing the enforcement of false claims of FDIC insurance. 

“By taking these actions, policymakers and regulators can demonstrate that they truly serve hardworking American consumers and small business owners, rather than rigging the banking game for special interests.” 

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Better Markets is a non-profit, non-partisan, and independent organization founded in the wake of the 2008 financial crisis to promote the public interest in the financial markets, support the financial reform of Wall Street and make our financial system work for all Americans again. Better Markets works with allies—including many in finance—to promote pro-market, pro-business and pro-growth policies that help build a stronger, safer financial system that protects and promotes Americans’ jobs, savings, retirements and more. To learn more, visit www.bettermarkets.org.