Section 7 of the BSCA requires depository institutions to notify, in writing, their respective federal banking agency of contracts or relationships with service providers that provide certain services. Services covered by the Act include check and deposit sorting and posting, computation and posting of interest, preparation and mailing of checks or statements, and other clerical, bookkeeping, accounting, statistical, or similar functions.
The agencies have also interpreted the notification requirement to include third parties that provide data processing, Internet banking, and mobile banking services. In addition, the BSCA subjects such service providers to regulation and examination by the federal banking agencies to the same extent as if such services were being performed by the depository institution. Similarly, the Homeowners Loan Act contains similar provisions regarding service providers of federal thrifts. (See 12 USC 1464(d)(7)).
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