WASHINGTON (Reuters) - Democrats are planning to dramatically step up their focus on improving financial services for underserved communities when they take control of the U.S. House of Representatives in January, according to several people briefed on the matter.
Representative Maxine Waters, who is poised to take over the chair of the Financial Services Committee after Democrats won a majority in the House in Nov. 6 elections, is considering creating a subcommittee dedicated to financial inclusion and diversity in the sector, as well as a taskforce to focus on financial technology innovation, the people said.
Waters had previously said the issue would be a priority.
The initiatives, which are still under discussion, offer a glimpse into how the committee’s top Democrat could set the agenda when she takes over as expected next year.
“Ranking member Waters is in the process of having conversations with the Democratic members of the committee about the committee’s future structure and seeking their input,” Waters’ spokesman Eric Hersey said in a statement. “This process has not been completed.”
Financial services lobbyists fear increased regulatory oversight of the sector could stall efforts to loosen stricter regulations put in place following the 2008 financial crisis.
Waters has said she would increase scrutiny of the nation’s biggest banks and push for tougher rules if placed in charge of the panel.
Financial inclusion and fintech are two areas where Democrats and Republicans may be able work together, however, lobbyists and lawmakers said.
Representative Patrick McHenry, the frontrunner for top Republican post on the committee, told Reuters last month he saw those areas as priorities if Republicans retained control.
Promoting financial inclusion could be good news for fintech firms, credit unions and community banks by opening up avenues for smaller financial institutions into communities that may have been neglected in the past.
Waters has yet to be formally named the committee’s next chairman but is widely expected to be appointed when Democrats vote on leadership roles in the coming weeks.
Reporting by Pete Schroeder; Editing by Michelle Price and Sonya Hepinstall