Blockchain Lending Firm Figure Seeks National Bank Charter

Financial services firm Figure Technologies, Inc. has sought a national bank charter from the Office of the Controller of the Currency (OCC), which will let it meet “promises of efficiency, affordability and financial inclusion,” according to a Friday (Nov. 6) announcement.

The charter would let the company gear its compliance activities toward the requirements of one regulator, provide a cohesive collection of offerings throughout the country, provide clients and business partners with the security of working with a federally regulated and supervised national bank and decrease its legal and regulatory expenses and risks.

“Figure is pursuing the charter to reduce the complexity of our business — we’ll have over 200 state licenses next year without such a charter,” Figure Co-Founder and CEO Mike Cagney said in the announcement. “By reducing complexity, we can leverage the technology efficiencies we have to deliver financial solutions to traditionally underserved and underrepresented consumers, driving real financial inclusion.”

C.D. Davies, head of lending at Figure, will spearhead the firm’s initiatives to get a bank charter from the OCC and he will become the Figure Bank chief executive officer, according to Cagney. Davies served as CitiMortgage’s chief executive officer and Citibank’s head of global mortgage in addition to Capital One’s president of home loans.

“This national bank charter will be instrumental in our efforts to continue to develop and deliver new financial products and services to communities across this country that really haven’t had access to affordable offerings,” Davies said. “I look forward to working with the OCC as we move forward on this journey.”

Figure says it has already built out the capacity to reduce the time it takes to originate a loan by a significant amount, and has sizably cut expenses in financing, origination, servicing and capital services market execution with blockchain technology.

For banks and other financial institutions, the tide is shifting toward an embrace of blockchain for handling transactions.

Figure Technologies said per a report in December that it originated approximately $1 billion in loans, with partners like Jefferies and Caliber Home Loans.

“You are starting to see that adoption beginning to happen,” Cagney told PYMNTS in a previous interview, “and the expectation is that [Provenance] is a utility for the broader financial ecosystem.”