Back in July 2022, Ford Credit announced that it was looking to establish an industrial bank subsidiary in the United States dubbed Ford Credit Bank. That move was pending approval from the Federal Deposit Insurance Corporation (FDIC) and Utah Department of Financial Institutions (UDFI) at the time, but aims to create a one-stop shop for EV customers looking to finance their vehicles, and it would take deposits and serve as one of the company’s sources of funding. That still hasn’t happened, over three years later, but it seems as if Ford Credit hasn’t given up on its bank endeavor, either.
Rather, according to Automotive News, Ford – along with its rivals General Motors, Nissan, and Stellantis – are all asking the FDIC to allow them to charter industrial loan companies, or banks, as they’re otherwise known. Toyota and BMW already operate their own banks, a desirable move for automakers, as it enables them to generally offer funds to customers at lower rates, though critics note that this type of business structure can also incentivize companies to take risks.
Ford Credit’s application with the FDIC has been pending for over three years now, and has since been joined by applications from the aforementioned rivals, so it’s unclear when or if it may be approved. Regardless, if that is the case, the plan is for Ford Credit Bank to serve as another source of funding for the automaker’s financial arm, and it would also “provide options for people to save money, help indirectly finance Ford vehicles through dealers, and support sales for dealers and Ford,” according to spokesperson Margaret Mellott.
According to Frank Pignanelli, executive director of the National Association of Industrial Bankers, the FDIC has become more receptive to applications for industrial banks in recent years, but the process can still take months or years to complete. There are “very rigorous standards you have to meet both at the state and federal level” to get an application approved, Pignanelli said, and Ford Credit has already met with regulators, answering questions and providing documentation along the way.
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