So, how do you keep tabs on your fintech partners—or even on your own programs? Through technology, of course. But how exactly?

Let’s explore the critical areas where compliance issues can arise. There are several consumer-facing interactions that your fintech partners might engage in that could be problematic.

Consents, Contracts, and Promissory Notes

First, let's discuss disclosures, consents, contracts, and promissory notes. How do you know if your fintech partners are using the approved language or the TILA documents you provided at the start of the program? If these documents change—possibly without your knowledge—issues could arise that spell trouble for compliance.

Are changes versioned and logged? Are older applications still using outdated consents and disclosures, or are newer versions mixed in without proper transitions? LendAPI’s document vaulting is a crucial feature that banks can leverage to distribute the latest versions of bank-approved documents to their fintech partners. Changes are thoroughly documented, with records of who made them.

If a fintech partner wants to make a change, bank personnel receive a notification, allowing them to log in and either approve or decline the change with comments.

KYC/KYB, Underwriting, and Pricing

Next, when it comes to underwriting, KYC (Know Your Customer), KYB (Know Your Business), and pricing changes, banks should have the ability to monitor and adjust these key criteria. Fintech partners should allow banks to view, edit, and approve any modifications, ensuring compliance and adherence to the agreed-upon standards from the beginning of the partnership.

Many Consumer Financial Protection Bureau (CFPB) consent orders are centered around banks’ oversight of their fintech relationships, particularly in ensuring the initial policies set at the partnership's outset are maintained in practice. LendAPI provides an environment where fintechs and banks work collaboratively, with a transparent multi-level approval process for program changes, from underwriting rules to pricing algorithms.

Loan or Applicant Approval Process

In cases where banks are funding loans, compliance isn’t the only concern—they also need to review or at least spot-check loans before funding. LendAPI enables fintech partners to invite banks to serve as the underwriter or final approver of loans before they’re funded, allowing banks or other funding partners to maintain control.

Data Transparency

LendAPI offers reporting and ETL (Extract, Transform, Load) capabilities, giving banks a clear line of sight into the data flowing through the originations process across all their fintech partnerships. This transparency allows banks to monitor for compliance issues or deviations from their fintech partnership agreements.

Banks Are in Control

LendAPI licenses its platform to banks, empowering them to manage underwriting models, pricing guidelines, and the contracts with KYC/KYB and credit bureau providers that their fintech partners can use at bulk pricing rates.

Banks have the ability to create “tenants” representing each of their fintech partners and assign tailored underwriting and pricing criteria to each. These fintech partners can then use the assigned underwriting criteria via LendAPI’s high-speed decision engine.

In essence, LendAPI functions as a command center for banks, distributing underwriting, pricing, and documentation via API to both internal programs and fintech partnerships. This allows banks to confidently manage their fintech partnerships as a central source of information and single record of truth.

About LendAPI

LendAPI is the only digital onboarding platform for banks that combines Product Studio, Rules Studio, Pricing Engine, Integration Marketplace, and Variable Studio into a single, seamless system. Together, these tools enable banks and fintechs to launch products with just a few clicks.

LendAPI’s robust tenant management system allows banks to centrally manage their fintech partners, delivering compliance and credit policies effortlessly through APIs.

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