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FDIC approves student loan servicer’s bid to become a bank

Thursday, March 19, 2020
Danielle Douglas-Gabriel | Washington Post
Whitney Barkley-Denney
Nelnet, one of the largest student loan-servicing companies, is gearing up to become a bank, a prospect that has consumer groups concerned. The Federal Deposit Insurance Corp. this week approved the firm’s application to form an industrial loan company, a state-chartered bank that can operate nationally with minimal federal oversight. The decision clears the way for the launch of Nelnet Bank, which will operate exclusively online. According to the company, the bank will focus on education lending but also offer consumer loans and refinance options.