CFPB to Roll Back Guidance; Bunq Plans to Enter U.S.; Edward Jones Seeks ILC
Cole Gottlieb, Research Analyst
Fed Chair Powell emphasizes importance of price stability for full employment. Credit card delinquencies hit 12-year high. CFPB to roll back guidance. Judge strikes down credit card late fee rule. AI mortgage startup raises $6Mn seed round. Starling wants to sell tech to U.S. banks. Bunq applies for broker-dealer license. Klarna partners with Fiserv’s Clover. Edward Jones resubmits ILC application.
Edge Focus announced the closing of its inaugural $150 million ABS deal, which was structured and placed by CRB Securities. Through CRB Securities, Cross River clients can diversify their funding strategy in a flexible and operationally efficient manner.
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Powell’s Balancing Act
Inflation may have come in lower than expected for March, but that doesn’t mean Fed Chair Powell’s job has gotten any easier. Powell warned last week that the central bank is likely to face tough trade-offs (no pun intended) as it tries to navigate the fallout from Trump’s tariffs and the escalating trade war with China. If tariffs push up prices and simultaneously slow economic activity, the Fed will have the unenviable task of having to prioritize between its two mandates: stable prices and full employment. If this comes to pass, the Fed would need to evaluate how severe inflation is, any weakening of the labor market, and the expected paths of each when weighing interest rate policy. In remarks he gave last week at the Economic Club of Chicago, Powell said, “Our obligation is to keep longer-term inflation expectations well anchored and to make certain that a one-time increase in the price level does not become an ongoing inflation problem.” Powell also used the remarks to emphasize that the long-term health of the labor market requires price stability.
Meanwhile, there are signs of stress emerging in some household balance sheets. The percent of credit card accounts that are 90 or more days past due hit a high not seen in 12 years, per new data from the Philadelphia Federal Reserve. Still, past due borrowers make up less than 1% (0.9%, specifically) of all credit card accounts.

CFPB to Rollback Guidance
Russ Vought, who remains as acting Director of the CFPB while Jonathan McKernan makes his way through the confirmation process, is seeking to nullify previously issued guidance en masse. Vought argues that the CFPB, under former Director Chopra, leaned heavily on guidance in place of formal rulemaking processes. Vought issued a memo requesting that the heads of eight CFPB offices, including enforcement and supervision, review previously issued guidance by April 25th. According to multiple outlets, Vought wrote in the memo, “The use of guidance to regulate is unlawful and deprives the public of fair notice of what conduct is prohibited. The Bureau will no longer engage in this practice. Effective immediately, Bureau components may not issue guidance documents that purport to create rights or obligations binding on persons or entities outside the Bureau.” Vought’s memo indicated any guidance not flagged for retention is likely to be rescinded.
In other CFPB-related news, a Texas judge has moved to invalidate the CFPB’s $8 cap on credit card late fees. The judge determined the rule violated both the CARD and the Administrative Procedures Acts. The rule would have permitted issuers to recoup actual costs associated with late payments, with the $8 “cap” being a safe harbor ceiling, but issuers would have been prohibited from imposing punitive fees. Estimates suggest, had the rule gone into effect, it would have reduced late fee income by about $10Bn.
Friday Harbor Raises $6Mn Seed Round
AI-powered mortgage origination startup Friday Harbor announced it has raised a $6Mn seed round. The financing was led by Abstract Ventures and Mischief, an early-stage fund cofounded by Plaid CEO Zach Perret. Friday Harbor’s platform is designed to help mortgage loan officers assemble and evaluate application files in “real time.” The company plans to use the proceeds to staff out its engineering team and build additional integrations with mortgage loan origination systems.
Starling Looks to Sell Tech to U.S. Banks and Credit Unions
U.K. business banking startup Starling is heading to the U.S. – sort of. The company, which is a chartered bank in its home market, is opening a U.S. subsidiary to market its homegrown tech infrastructure to mid-sized American banks and credit unions. The offering, dubbed Engine by Starling, will be based out of the east coast and is in the process of staffing up. Romania’s Salt Bank, the first customer for Engine, now boasts more than 500,000 users on the platform. Engine by Starling CEO Sam Everington said of the company’s North America ambitions, “We are already having really positive discussions with a number of potential partners in North America because Engine solves some of the major challenges facing banks and credit unions here. Engine delivers a unique ability to unify tech stacks, drive efficiency and encourage innovation through one managed service. It is a very compelling proposition that’s specifically designed to bring digital propositions to life faster and with very high quality outcomes.”
Dutch Bank Bunq Seeks U.S. Broker-Dealer License
Dutch neobank bunq, which is a fully chartered bank in its home country of the Netherlands, is making a second attempt to enter the American market. The company had applied for an OCC charter in 2023, but withdrew the application. Now, bunq has filed for a broker-dealer license with the SEC and Finra, which it is positioning as a “first phase” of its effort to obtain a U.S. bank charter. Bunq said the broker-dealer license would “fast track” its entry to the U.S., though it will still need to partner with one or multiple banks to hold its customers’ sweep deposits and to issue debit cards for the planned cash management accounts.
Klarna Partners with Fiserv’s Clover Subsidiary
Despite the IPO setback, Klarna isn’t slowing down. The company’s recently signed deal with Fiserv will make Klarna-powered loans available through Fiserv’s Clover point of sale devices at merchants across the U.S. The initial rollout includes 100,000 merchant locations, the companies said, with an expansion planned for 2026. The payment options will include debit/pay now and interest-free financing.
Edward Jones Resubmits ILC Application
If at first you don’t succeed, try, try again. Investment firm Edward Jones, which unsuccessfully sought an industrial loan company charter in 2020, is trying again. The firm had abandoned the push in 2022, when it became clear that a Democrat-controlled FDIC was extremely unlikely to approve any deposit insurance applications for ILCs. Now, the winds have shifted, and the so-called “charter window” seems to be open. Edward Jones submitted an application to the Utah Department of Financial Institutions and the FDIC to establish Edward Jones Bank. In the meantime, the company also plans to move forward with its retail banking partnership with U.S. Bank.
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