Over the past few years, one of the more noteworthy types of new financial services rules at the state level has been the so-called fair access to banking law. Concerns about ideological debanking have gained political traction in the past decade, leading state legislatures to pass laws preventing financial institutions from denying services to or otherwise discriminating against potential and existing customers based on politics, religion or involvement in controversial but legal businesses.
On July 1, Idaho saw its fair access law go into effect, joining Florida and Tennessee as the third state with active legislation. Numerous other states have proposed fair access laws as well, and there are indications that the issue may once again be a focus of the Trump administration. Interest in tackling the debanking issue, therefore, continues at both the federal and state levels.
The state laws that have passed in Florida, Idaho and Tennessee have plenty of similarities but also some notable differences. Given that two different approaches to addressing debanking have now emerged, the time is ripe to assess how legislators and rulemakers can balance concerns about discriminatory banking with operational realities for financial institutions.
After analyzing the approaches that have emerged thus far, we favor a more standardized approach moving forward. To the extent debanking is a problem, it's one that merits a uniform nationwide standard. Ideally, a single set of rules administered by a small number of federal agencies would provide consistency and be a lighter and lower-cost regulatory scheme for financial institutions than a patchwork of varying state laws.
The Origin of Fair Access Legislation
The fair access movement emerged from reports of financial institutions denying services to customers on grounds outside standard quantitative risk factors. Some customers alleged they were singled out for political reasons and because of their involvement in controversial industries, like firearms and fossil fuels. At other times, the complaining customers concluded that their religious or political beliefs led them to be debanked.
The first reaction to debanking came at the federal level in the final month of the first Trump administration, when the Office of the Comptroller of the Currency finalized in January 2021 a rule meant to ensure fair access to financial services. However, the Biden administration paused the rule before it went into effect, and the rule has never been revisited, revised or republished. The momentum then shifted to state legislatures.
State-by-State Analysis
The three states that have passed fair access legislation broadly agree upon what they seek to forbid: discriminating against customers based on politics, religion or involvement in controversial but legal industries, such as fossil fuels and firearms.
There are differences between the characteristics and activities the states have chosen to address, and institutions should read each law closely. But the salient differences for the purposes of this article lie in the scope of institutions covered by each law and the enforcement mechanisms.
Florida: Broad Scope, State Enforcement
Florida moved first to create a debanking act.
The law, passed in 2023, set up a customer complaint process. If a customer files a complaint, the bank must submit a response to state regulators. If the regulator finds merit in the complaint, the regulator refers the complaint to state prosecutors. The Florida Legislature considered but rejected a private right of action for aggrieved consumers.
When first enacted, the statute applied only to financial institutions licensed or chartered in Florida. A 2024 amendment, however, expanded the scope of the law to federal banks, savings associations, trust companies and credit unions. Questions remain about whether a physical presence in Florida is required to bring an institution within the scope of the law.
Tennessee and Idaho: Narrow Scope, Two-Tiered Enforcement
The Tennessee Legislature went a different direction in 2024 by limiting the scope of its fair access requirements to financial institutions with assets over $100 billion. Smaller banks, credit unions and other nonbank financial institutions are thus exempt from the law.
The Tennessee Legislature did, however, decide to allow for both enforcement by the state attorney general's office and private lawsuits by consumers who allege violations.
This year, Idaho passed a law that generally tracks Tennessee's. It includes a $100-billion-asset threshold, enforcement by the state attorney general and a private right of action. The main difference was an extension of the law to payment processors; those that process $100 billion in annual payments must also comply with the fair access requirements.
Future Acts?
Further fair access rules are a distinct likelihood. In the past two years, at least 10 other states saw fair access legislation introduced. Furthermore, President Donald Trump promised during the 2024 presidential campaign to address debanking, and multiple bills on the issue have been introduced in the U.S. House of Representatives and the U.S. Senate.
Although the OCC has not indicated a plan to reinstate the fair access rule paused by the Biden administration, the bank regulators — the OCC, Federal Deposit Insurance Corp. and Federal Reserve Board — have all announced they will no longer examine regulated institutions for reputational risk. This factor is generally agreed to have led to complaints of ideological debanking.
With future efforts to combat debanking ongoing, the question that now arises is which approach is preferable. Should states or the federal government adopt the Florida approach of reserving enforcement to a complaint and investigation process, or should they provide aggrieved consumers with a private right of action to enforce compliance, like Idaho and Tennessee?
Standardization and Uniform Enforcement
The divergent approaches that have already emerged for tackling debanking concerns highlight the importance of standardization moving forward. Without a uniform nationwide standard administered by a small number of federal agencies, any institution that operates across multiple states must become familiar with different requirements and prohibitions, documentation standards, and enforcement mechanisms. These increased compliance costs are ultimately passed down to customers, creating an access problem of another sort.
On top of that, the ideological nature of this debate risks further polarizing public opinion of the banking system along left-right lines if the states continue to lead on fair access laws. Whether via regulatory actions or congressional legislation, the federal government is well suited to take the lead on banking access.
Whatever level of government takes the next step, reserving enforcement to a complaint and investigation process, as in Florida, strikes us as the better course, as opposed to offering a private right of action.
Access to banking touches on areas where regulators are already at work, like civil rights, money laundering and fraud. A lawsuit by an aggrieved customer hands the microscope of banking oversight to judges, jury members and attorneys who all likely lack the same background knowledge of the banking system. And, considering the hot-button political and ideological nature of the concerns raised by the fair access advocates, courtroom emotions are likely to run high in civil litigation.
Legislators and rulemakers are faced with a set of competing considerations: maintaining public confidence in the fairness of the banking system and providing a pathway to address customer grievances, while keeping the costs of banking and credit in check. Uniform standards and consistent enforcement will serve both regulated banks and American consumers.
Republished with permission. This article, "State Laws Show Uniformity Is Key To Truly Fair Bank Access," was published by Law360 on August 14, 2025.
