DOVER, Del. - State leaders from Delaware's financial sector are introducing new laws that they claim will update the state's banking system in order to keep up with modern technology.
Sen. Spiros Mantzavinos, D-Elsmere, and Rep. Bill Bush, D-Dover, filed the legislation. According to them, Senate Bill 16, also known as the Delaware Banking Modernization Act, would be the first major revision to Title 5 of the Delaware Code since the 1981 passage of the Financial Center Development Act.
"In 1981, our predecessors in the General Assembly passed the Financial Center Development Act, paving the way for Delaware to become the 'credit card capital' of the nation. That was decades ago — and much has changed in our financial sector in that time," said Mantzavinos, chair of the Senate Banking, Business, Insurance & Technology Committee. "Modernizing Delaware's banking code is long overdue. With this package of legislation, we're not vastly changing our identity in the financial sector, but we're continuing the tradition that made us successful in the first place."
The Financial Center Development Act was hugely consequential in turning the first state into a major financial hub. That law led to a major increase in financial sector jobs in Delaware. According to the new bill's sponsors, finance still makes up about 9 percent of jobs in the state, which is nearly double the national average.
The stated goal of Senate Bill 16 is to:
- Define digital assets (like cryptocurrencies)
- Expand the state bank commissioner's authority
- Give regulators more authority to oversee banks
- Allow banks to operate more easily across state lines
- Strengthen protections for consumers
"Our administration is focused on attracting the jobs of the future to the First State, and that includes continuing to foster an innovative banking ecosystem that will open doors not just for workers and companies, but for every single person who participates in our economy," said Gov. Matt Meyer. "This legislative package sends a signal loud and clear: here in Delaware, we're democratizing our financial services and lowering the barriers to entry, making it easier for all residents to send, receive and save money with just an internet connection."
MORE EXPECTED FINANCIAL LEGISLATION
More financial regulations, specifically with a focus on financial technology, are expected in the near future. One of those is the Delaware Money Transmission & Virtual Currency Modernization Act. This act is expected to be designed to improve the regulation of money transfers and digital currencies and prevent financial crimes. It would also make rule more consistent across states and better protect customer funds.
Another piece of expected upcoming legislation is the Delaware Payment Stablecoin Act. This would focus on establishing monetary reserve requirements, consumer protections, anti-laundering rules and privacy safeguards.
"Financial services are evolving at a pace that would have been difficult to imagine a decade ago. New technologies, new payment systems, and new financial products are reshaping how consumers move money, access financial services and interact with the broader economy," said Lisa Collison, Delaware State Bank Commissioner. "As the state regulatory authority for financial services, our responsibility is to ensure that the legal frameworks governing these services evolve as well."
All of these bills still have a number of hurdles to clear before they become law. Currently, they have been assigned to the Senate Banking, Business, Insurance & Technology Committee. After that, they still need to be passed by the House and Senate before being signed into law by the governor.