NetChoice and TechNet sue the US CFPB to block regulation

TechNet, joined by NetChoice, filed suit in the US Federal District Court for the District of Colombia against the CFPB, challenging its intention to allow itself additional authority over non-bank financial technology industry participants. Through this, the two companies aim to safeguard consumers, businesses, and advancement from regulators misusing their authority to wrongly expand power over the US economy.

The lawsuit stems from a law finalised by the CFPB in November 2024 that enabled it to supervise big tech companies offering digital fund transfer and payment wallet apps. The regulator intended to ensure that these large non-bank companies fell in line with federal law requirements similar to how large banks, credit unions, and other financial institutions did.

NetChoice and TechNet versus the CFPB

According to NetChoice and TechNet, the CFPB’s rule goes beyond the agency’s authority and scales government power over the economy. Also, the two companies allege that this represents an overreach that is not about protecting consumers, but about consolidating control over the fintech sector. The tech groups mentioned that the CFPB found no consumer risks or gaps in regulatory oversight that justified the regulation, which includes companies that process a minimum of 50 million transactions annually and over 13 billion overall.

Furthermore, in its statement, TechNet underlined that instead of facilitating a regulatory environment that assists responsible innovation, the CFPB undermines the principles that make the US a strong participant in global financial technology. Additionally, it was mentioned that this action is inconsistent with the agency’s statutory mandate and creates a risky precedent that federal organisations can operate beyond the limits put in place by Congress. Representatives from TechNet highlighted that through this lawsuit filed together with NetChoice, the two tech groups intend to preserve a competitive and fair marketplace that encourages advancement and safeguards consumers without undue interference.