Community Banks Face Core Processor Frictions

The Office of the Comptroller of the Currency issued a December Request for Information about community banks’ relationships with core processors, and commenters responded by the end of the commentary period late last month. PYMNTS Intelligence shows 32% of lower-revenue SMBs favor community banks while 52% of Gen Z and millennials would consider switching if local banks match competitive technology; respondents cited API delays, opaque pricing, data portability limits, and AI governance gaps.