State AGs Challenge Fintech Bank Acquisitions by OppFi and Enova

A coalition of 20 state attorneys general is asking federal banking regulators to block two of the most closely watched fintech-bank deals in the market, according to reporting by Banking Dive's Gabrielle Saulsbery and the coalition's July 15 letter to the heads of the OCC, FDIC, and Federal Reserve.

The targets: Opportunity Financial's pending $130 million acquisition of BNC National Bank in Arizona, and Enova International's pending $369 million purchase of Grasshopper Bank. Both deals await regulatory approval, which is exactly the pressure point the AGs are leaning on.

What the AGs argue

The letter, led by Illinois' Kwame Raoul and joined by attorneys general from California, New York, Massachusetts, and sixteen other states plus D.C., frames the deals as a consumer protection issue. The AGs note that nearly every state maintains an interest rate cap, commonly 36% for small loans, and argue that both companies currently partner with banks chartered in states without caps to offer loans above those limits. In the coalition's words, these arrangements are "deliberate efforts to avoid state usury laws." Granting the companies their own charters, the AGs contend, would make that structure permanent, and they urged regulators to deny "access to national banking privileges" to firms they characterize as having sought to evade state law. Invoking their early warnings on subprime mortgages before 2008, the AGs wrote: "Now, we sound the alarm again."

The companies' answer

An OppFi spokesperson told Banking Dive the company already offers a compliant, consumer-friendly product, and that moving the model into regulated banking infrastructure would "pair our proven product with extensive federal oversight."

Enova Chief Strategy Officer Kirk Chartier went a step further and turned the AGs' own playbook against the letter, noting that 21 different state attorneys general recently filed an amicus brief in federal appellate court defending a state bank's right to export home-state interest rates, the very mechanism this letter attacks. As a national bank, Chartier wrote, Enova would operate under "full federal banking agency supervision and consumer protections."

Why watch closely

The consumer-lending framing can make this feel distant from commercial finance. It isn't. Enova owns OnDeck and Headway Capital, two of the biggest names in online small business lending, and OppFi has moved into small business funding through its investment in Bitty Advance. The outcome of these applications will shape how the largest nonbank SMB lenders structure themselves for the next decade: charter-owning institutions, bank-partnered originators, or state-licensed lenders navigating the patchwork.

And the fintech bank acquisitions precedent cuts across the industry. If regulators approve the deals, expect more fintech lenders to pursue charters and a gradual migration out of partnership structures. If they side with the AGs, the message is that the charter route is essentially closed to lenders whose pricing models offend state caps, leaving the partnership model, and the litigation risk that comes with it, as the only path to national scale.