Amazon.com Inc. is pushing for its payment service to be exempted from a proposed rule by the Consumer Financial Protection Bureau (CFPB) that increases supervision of large tech corporations offering digital wallets. The regulation targets the 17 largest digital payment companies, with tech giants such as Apple, Google, and Facebook also expected to fall under its purview.
Specifically, Amazon claims that Amazon Pay, which facilitates rapid customer transactions through third-party merchants on its platform, does not fall within the realm of this proposal because it does not store customer funds. According to a letter the company sent to the CFPB on January 8th, Amazon Pay merely keeps credit and debit card credentials used solely to process payments at a customer’s discretion.
In stark contrast, the proposed regulation is aimed primarily at digital wallet providers that store customer funds, leading to potential overlaps with traditional financial services. The goal is to place these digital wallet services under increased regulatory scrutiny, similar to traditional banks and financial institutions.
As this regulation’s final form and its impact on the targeted companies continues to unfold, it will be crucial for legal professionals within these large corporations and law firms to stay updated and adapt their compliance and regulatory strategies accordingly.
For a more thorough analysis of this issue, legal practitioners can access the original article at Bloomberg Law.