[Federal Register Volume 86, Number 212 (Friday, November 5, 2021)]
[Notices]
[Pages 61182-61183]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-24176]


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BUREAU OF CONSUMER FINANCIAL PROTECTION

[Docket No. CFPB-2021-0017]


Notice and Request for Comment Regarding the CFPB's Inquiry Into 
Big Tech Payment Platforms

AGENCY: Bureau of Consumer Financial Protection.

ACTION: Notice; request for comment.

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SUMMARY: On October 21, 2021, the Consumer Financial Protection Bureau 
(Bureau or CFPB) ordered six large technology companies operating 
payments systems in the United States to provide information about 
certain of their business practices. The information will help the CFPB 
better understand how these firms use personal payments data and manage 
data access to users so the Bureau can ensure adequate consumer 
protection. Accompanying the orders, the Director of the Bureau issued 
a statement which is reprinted in this document for public review and 
comment. The Bureau invites any interested parties, including 
consumers, small businesses, advocates, financial institutions, 
investors, and experts in privacy, technology, and national security to 
submit comments to inform the agency's inquiry.

DATES: Comments must be received on or before December 6, 2021.

ADDRESSES: You may submit comments, identified by Docket No. CFPB-2021-
0017, by any of the following methods:
     Federal eRulemaking Portal: https://www.regulations.gov. 
Follow the instructions for submitting comments.
     Email: [email protected]. Include Docket No. 
CFPB-2021-0017 in the subject line of the message.
     Mail/Hand Delivery/Courier: Comment Intake--Statement into 
Big Tech Payment Platforms, Bureau of Consumer Financial Protection, 
1700 G Street NW, Washington, DC 20552. Please note that due to 
circumstances associated with the COVID-19 pandemic, the Bureau 
discourages the submission of comments by hand delivery, mail, or 
courier.
    Instructions: The Bureau encourages the early submission of 
comments. All submissions should include document title and docket 
number. Because paper mail in the Washington, DC area and at the Bureau 
is subject to delay, commenters are encouraged to submit comments 
electronically. In general, all comments received will be posted 
without change to https://www.regulations.gov. In addition, once the 
Bureau's headquarters reopens, comments will be available for public 
inspection and copying at 1700 G Street NW, Washington, DC 20552, on 
official business days between the hours of 10 a.m. and 5 p.m. Eastern 
Time. At that time, you can make an appointment to inspect the 
documents by telephoning 202-435-7275.
    All comments, including attachments and other supporting materials, 
will become part of the public record and subject to public disclosure. 
Proprietary information or sensitive personal information, such as 
account numbers or Social Security numbers, or names of other 
individuals, should not be included. Comments will not be edited to 
remove any identifying or contact information.

FOR FURTHER INFORMATION CONTACT: Amy Zirkle, Program Manager for 
Payments & Deposits, (202) 435-7505. If you require this document in an 
alternative electronic format, please contact 
[email protected].

SUPPLEMENTARY INFORMATION:

I. Background

    The following statement was issued by the Bureau's Director, Rohit 
Chopra, on October 21, 2021. This statement accompanied orders issued 
to six large technology companies operating payments systems in the 
United States to provide information about certain of their business 
practices.\1\ The Bureau invites any interested parties to submit 
comments to inform the agency's inquiry.
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    \1\ An example order can be found at https://www.consumerfinance.gov/documents/10176/cfpb_section-1022_generic-order_2021-10.pdf.
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II. October 21, 2021 Statement

    Faster, friction-less, and cheaper payment systems offer 
significant potential benefits to consumers, workers, their families, 
and small businesses in the United States. For example, families can 
send money to friends without delay, or to relatives overseas at lower 
costs. Fast payment systems can also help small businesses succeed with 
quicker transactions, lower cost, and more revenue conversion. And 
faster settlement can reduce the need for families and businesses to 
borrow.
    But payments businesses are network businesses and can gain 
tremendous scale and market power, potentially posing new risks and 
undermining fair competition. Furthermore, knowing what we spend our 
money on is a valuable source of data on consumer behavior. This data 
can be monetized by companies that seek to profit from behavioral 
targeting, particularly around advertising and e-commerce. That many 
Big Tech companies aspire to grow in this space only heightens these 
concerns.
    In China, we can already see the long-term implications of these 
forces. Alipay and WeChat Pay are deeply imbedded into the lives of the 
Chinese public, combining messaging, e-commerce and payment 
functionality into super-apps. In such a market, consumers have little 
choice but to use these apps and little market power to shape how their 
data is used.
    Today the Consumer Financial Protection Bureau (CFPB) has ordered 
six technology platforms offering payment services to turn over 
information about their products, plans and practices when it comes to 
payments. The orders were issued to Google, Apple, Facebook, Amazon, 
Square, and PayPal. The CFPB will also study the practices of the 
Chinese tech giants that offer payments services, such as WeChat Pay 
and Alipay.
    Congress has tasked the CFPB with ensuring that markets for 
consumer financial products and services are fair, transparent, and 
competitive. To that end, it has authorized the CFPB to require 
participants in the marketplace

[[Page 61183]]

to provide information that help the Bureau monitor risks to consumers 
and to publish aggregated findings that are in the public interest.
    Little is known publicly about how Big Tech companies will exploit 
their payments platforms. For example, will the operators engage in 
invasive financial surveillance and combine the data they collect on 
consumers with their geolocation and browsing data? \2\ Will they in 
turn use this data to deepen behavioral advertising, engage in price 
discrimination, or sell to third parties?
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    \2\ In 2019, I joined global privacy regulators to seek 
information about Facebook's Libra project. At the time, the company 
failed to substantively respond. See https://www.priv.gc.ca/en/opc-news/speeches/2019/s-d_190805/.
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    Will these companies operate their payment platforms in a manner 
that interferes with fair, transparent, and competitive markets? Will 
the payment platforms be truly neutral, or will they use their scale to 
extract rents from market participants? Will small businesses feel 
coerced into participating in the payment platform out of fear of being 
suppressed or hidden in search or product listings? If these tech 
companies enter a market that competes with other providers on the 
platform, will these providers be removed or otherwise disadvantaged? 
What factors will these tech companies use when disqualifying or 
delisting an individual or business from participating on the platform?
    Finally, how will these payment platforms ensure that key consumer 
protections are adhered to? How effectively do they manage complaints, 
disputes and errors? Are they sufficiently staffed to ensure adequate 
steps are taken to address consumer protection and provide responsive 
customer service when things go wrong? \3\
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    \3\ The law currently provides for a number of safeguards in the 
payments sector, including but not limited to the Electronic Fund 
Transfer Act, the Gramm-Leach-Bliley Act, and the Consumer Financial 
Protection Act.
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    The CFPB's inquiry will help to inform regulators and policymakers 
about the future of our payments system. Importantly, it will also 
yield insights that may help the CFPB to implement other statutory 
responsibilities, including any potential rulemaking under Section 1033 
of the Dodd-Frank Wall Street Reform and Consumer Protection Act. The 
CFPB's orders build on the efforts of the Federal Trade Commission's 
work to shed light on the business practices of the largest technology 
companies in the world.
    The CFPB's inquiry is one of many efforts within the Federal 
Reserve System to plan for the future of real-time payments and to 
ensure a fair and competitive payments system in our country. The 
Bureau intends to open a Federal Register docket to invite public 
comment. I invite any interested parties to submit comments to inform 
the agency's inquiry.

    Dated: November 1, 2021.
Rohit Chopra,
Director, Bureau of Consumer Financial Protection.
[FR Doc. 2021-24176 Filed 11-4-21; 8:45 am]
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