Committee to Establish the
National Institute of Finance
Providing the data and analytic tools needed to safeguard the U.S. financial system
Home FAQs: Role of the NIF Value and cost
Value and cost
What burdens would the NIF place on small banks and small financial entities?  E-mail

Small banks and financial firms already largely rely on off-the-shelf software and services from third-party data and systems vendors for portfolio management. Consequently, the NIF should not impose significant new operational burdens on small banks. In addition, the public reference databases maintained by the NIF would provide benefits to all market participants, particularly those too small to maintain or purchase their own substitute services. In this way, the NIF would help level the playing field for institutions of all sizes.

If the U.S. adopts this approach while other jurisdictions do not, how would the competitiveness of U.S. financial markets be affected?  E-mail

We believe that the creation of the NIF would put the U.S. at a competitive advantage vis-a-vis other jurisdictions. By helping to reduce the threat of hidden systemic risks, the NIF would increase investors' confidence in the U.S. markets.

How would the costs of the NIF get paid for? Would it require higher taxes?  E-mail

As proposed, the NIF would be funded through assessments on the financial institutions that report data to the NIF.  Reporting institutions would realize efficiencies from the use of centrally maintained and universally accepted data standards. As proposed, the NIF would not increase the burdens on U.S. taxpayers, nor increase the federal deficit.

What is the fundamental value proposition of the NIF?  E-mail

The fundamental benefits of the NIF are three-fold: It will improve the efficiency and effectiveness of financial regulation; it will reduce the likelihood of systemic crises and costly institutional failures; and it will consequently increase public confidence and trust in our financial markets.

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