Washington's banking rules have shuttered thousands of community banks

Stringent post-crisis regulations have driven the count of federally insured banks down from about 7,600 to 3,900, eliminating roughly 3,700 community institutions and causing more than 5,000 brick-and-mortar branches to shut. This contraction reduces local lending options and competition for both consumers and small businesses. Advocates suggest that regulators such as the OCC and FDIC should streamline the approval process for new banks, including technology-driven lenders, to bring more entities under capital, consumer-protection, and prudential oversight.

They note that over 12 million Americans rely on short-term loans for essential expenses, and tighter state interest caps have often restricted credit for higher-risk borrowers without easing financial distress. By granting more charters to fintechs, the system could increase competition while maintaining regulatory safeguards. The piece argues that expanding the banking landscape, not adding barriers, is essential for broader financial inclusion.