CFPB's Open Banking Revision Reaches the White House: A Signal for Banks Building Settlement Infrastructure

The Consumer Financial Protection Bureau submitted its revised Section 1033 open banking proposal to the Office of Information and Regulatory Affairs on August 5, clearing the administrative hurdle that precedes publication in the Federal Register. The proposal has not been publicly released but could be issued any day now that it has been submitted to the White House's Office of Information and Regulatory Affairs. For payments infrastructure leaders, the timing matters more than the substance.

April 1, 2026, was supposed to mark the first compliance deadline under the CFPB's Personal Financial Data Rights rule. Instead, it marks something very different: a regulatory regime in flux. A federal court has enjoined the CFPB from enforcing the rule while the Bureau undertakes a reconsideration process. The federal regulation of open banking in the United States has been in an extraordinary state of limbo. The CFPB's final rules implementing Section 1033 of the Dodd-Frank Act remain codified in the Code of Federal Regulations but are effectively unenforceable. A federal court in Kentucky enjoined the CFPB from enforcing the rules, finding that they likely exceeded the Bureau's statutory authority and were arbitrary and capricious.

This limbo is not a pause, it is an opportunity. Many institutions have invested heavily in data-sharing infrastructure and API development. Those systems are not going away. When enforcement resumes (or a revised rule is issued), those early design decisions will define what compliance looks like in practice. The compliance architecture banks build now, for data portability, third-party access, and consumer authorisation, will become the foundation on which all subsequent payment infrastructure sits.

While traditional banks deliberate, crypto-native institutions are moving. Circle Internet Group received approval from the U.S. Office of the Comptroller of the Currency to establish First National Digital Currency Bank, N.A., a national trust bank operating under the name Circle National Trust. OCC approval of a national trust bank charter represents a major U.S. regulatory milestone and strengthens the infrastructure of USDC through federally-regulated custody. It places Circle National Trust under direct federal oversight by the OCC, the primary regulator for national banks and national trust banks.

Circle is not alone. Circle was one of five firms, along with Ripple, Paxos, BitGo and Fidelity, whose national trust bank charter applications were conditionally approved in December by the OCC. BitGo received its unconditional charter shortly thereafter. During 2025 alone, the OCC received 14 de novo charter applications, a number nearly equaling the total applications received by the agency in the previous four years combined. Now, barely two and a half months into 2026, the OCC has already approved four new applications and received north of seven. A Q1 2026 fintech report from Pitchbook notes that fintechs and crypto firms have been applying for charters within the last year due to a "now-or-never moment" of regulatory receptivity under the current administration. Trust charters, in particular, have received a boost from the stablecoin bill known as the GENIUS Act that was passed into law last summer.

The GENIUS Act provides the federal framework these institutions are building toward. President Donald Trump signed into law the Guiding and Establishing National Innovation for US Stablecoins Act of 2025, establishing the first federal regulatory framework for stablecoins in the United States. The signing follows the US House of Representatives' July 17, 2025, passage of the GENIUS Act by a bipartisan vote of 308, 122. The GENIUS Act is, to date, the most significant of a series of reforms sought by the Trump administration to create a comprehensive regulatory framework for digital assets. The bill defines payment stablecoin as a digital asset issued for payment or settlement and redeemable at a predetermined fixed amount. Issuers would be required to hold at least one dollar of permitted reserves for every one dollar of stablecoins issued.

This creates a competitive asymmetry. These new entrants are building regulated banking infrastructure with stablecoin settlement baked in from day one. Bank-issued stablecoins are moving from proof of concept to production-grade infrastructure in 2026. Banks are using fiat-backed stablecoins and closely related tokenized deposit models to enable faster settlement, 24/7 treasury operations, and programmable money flows across internal systems and selected external networks. Traditional banks operating batch settlement systems face a different calculus: retrofit 24/7 settlement onto legacy infrastructure, or watch market share migrate to institutions that never had legacy rails to begin with.

The pressure on legacy rails is real. Traditional systems such as SWIFT, ACH, and card networks remain critical, but their limitations in speed, cost, and transparency have opened the door for blockchain-based alternatives. Crypto payment rails, powered by stablecoins and high-efficiency blockchains, now process trillions annually and serve as real settlement infrastructure for fintechs and enterprises. These rails offer lower costs, faster settlement, programmability, and unparalleled transparency. Standard ACH prioritizes low-cost transactions over fast money movement, so settlement happens within three working days. It also operates on batch schedules, meaning payments submitted Thursday afternoon might not clear until Tuesday.

The open banking revision changes the timing equation. The Bureau's decision to revisit Section 1033 reflects a recalibration under the current administration. In the ANPRM, the CFPB stated it would replace the Biden-era final rule with a new version "more suited to market realities." Under a revised open-banking proposal, banks are expected to be allowed to charge fees to fintechs and other third parties that want to access customer financial data. This shift, from mandated free access to potential fee structures, represents a fundamental change in the economics of data sharing. Banks that embed programmable settlement into their data infrastructure now will be positioned to monetise access to that infrastructure later.

Section 1033 did not go live on April 1 in the way originally expected. But it also did not go away. The better view is that the rule is paused, contested, and being rewritten, but the direction of travel remains clear. Open banking is coming. The question for payments infrastructure leaders is not whether to build data-sharing capabilities, but what settlement architecture those capabilities will sit on.

"With a clear federal framework for payment stablecoins expected by mid-2026, the integration of 24/7 blockchain-based settlement rails into commercial banking will become permanent infrastructure, being a strong competitor with the potential to displace legacy rails for cross-border corporate payments." Banks that wait for final rules before making infrastructure decisions will find themselves retrofitting stablecoin capabilities onto compliance systems designed for batch processing. Banks that move now will shape how their compliance frameworks treat programmable money, and capture the economic value that comes from being infrastructure rather than merely infrastructure-compliant.

The regulatory window is finite. Once the revised Section 1033 rule is finalised, the architecture hardens. The question is whether your settlement infrastructure will be inside that architecture or bolted onto it afterward.

References

[1] CFPB Sends Open-Banking Rule Redo To White House, Law360