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Vision 2020 initiative to develop common platform from licensing through supervision

Washington, D.C. – The Conference of State Bank Supervisors (CSBS) has launched a major redesign of the Nationwide Multistate Licensing System (NMLS), the core technology platform used by state bank regulators. The redesign will enable regulators to transform the licensing and supervision of non-bank financial institutions, including fintechs.

John Ducrest, commissioner of the Louisiana Office of Financial Institutions, said: “Technology and data are powerful tools that can create sweeping benefits throughout the financial regulatory system. And that vision drives our efforts with the next-generation NMLS. We are committed to nothing less than modernized state regulation for a modernized financial services industry.”

He added: “Better risk management, greater efficiency, and the inclusion of a modern examination system, are among the benefits the next-generation NMLS will offer state regulators. Meanwhile, fintechs and other non-banks will benefit from faster licensing approvals, more standardized experiences, and smoother sailing to nationwide expansion.”

Ducrest is chairman of the Board of Managers of the State Regulatory Registry, a CSBS subsidiary that owns and operates NMLS on behalf of state regulators.

Regulators today use NMLS to license companies in non-bank industries such as mortgages, money services, consumer finance and debt collection. Further, NMLS Consumer Access is a website where consumers can check on companies they work with. For the NMLS redesign, CSBS selected PwC LLP (Price WaterhouseCoopers LLP) as the lead technology vendor, using the Appian platform, and Fieldprint as the criminal background processor.

Redesigning NMLS is part of a larger effort, CSBS Vision 2020, which state regulators are conducting as they move towards an integrated, 50-state system of licensing and supervision. Other initiatives include forming a fintech advisory panel, harmonizing multi-state supervision, and assisting state banking departments.

The following chart summarizes the work now underway for the next-generation NMLS:

 

 

 

Current NMLS

Next Generation NMLS

Benefit

Risk management

Uniform application forms with limited distinction by risk

Business tools to categorize applications by potential risk

Regulators deploy more resources to higher-risk cases

Single-state licensing

Manual, independent reviews by each state

Streamlined process for lower-risk applications

Faster approvals for vast majority of applications

Multi-state licensing

States generally perform own licensing analysis

 

States better able to access and rely on analyses from other states

Non-banks can more quickly expand and maintain their market footprint

Examination

Not available in NMLS

 

 

A state examination system with uniform process capabilities, data analytics, and information sharing among states

Regulators can streamline many exam workflows

Supervision

Regulatory convergence has produced a standardized experience for mortgage firms

Standardized regulatory experiences to develop for institutions other than mortgage firms

A more consistent, multi-state supervisory experience for non-banks

Consumer protection

 

NMLS Consumer Access identifies licensed firms, locations, and adverse regulatory actions

More consumer-friendly terms to understand a firm’s business, and inclusion of actions from more regulators

Consumers able to make better-informed decisions on key financial services transactions

 

Media Contact: Jim Kurtzke … jkurtzke@csbs.org … 202-728-5733

Twitter: @CSBSNews @ NMLSInfo

The Conference of State Bank Supervisors (CSBS) is the national organization of bank regulators from all 50 states, American Samoa, District of Columbia, Guam, Puerto Rico and U.S. Virgin Islands. State regulators supervise roughly three-quarters of all U.S. banks and a variety of non-depository financial services. CSBS, on behalf of state regulators, also operates the Nationwide Multistate Licensing System to license and register non-depository financial service providers in the mortgage, money services businesses, consumer finance and debt industries.