The Consumer Financial Protection Bureau (CFPB) has released a Notice of Proposed Rulemaking, which seeks to “level the playing field” between banks and digital payment systems. The rule would expand the CFPB’s authority over digital wallets and payment applications despite these methods not presenting a risk to consumers that might otherwise warrant intervention. Though new technology always presents new vulnerabilities, sometimes solutions can be easily implemented by individuals and don’t require regulatory expansion, especially when the CFPB’s motivations have little to do with the consumer and a lot to do with antitrust.

Despite not explicitly mentioning the payment applications covered under the proposed rule, it can be reasonably assumed that affected apps will include Google Pay, Apple Pay, PayPal, and others. These payment systems use existing banking credit, debit, and transfer programs to pay merchants and other users virtually. A system like this reduces the number of physical items (like credit cards) needed to complete a transaction. Instead, users can include these items on their phone or computer and pay accordingly.

Digital transactions do pose some new risks. Two notable examples include exposure to “interception” by hackers when using a wireless network and phones becoming a node for financial access. Both issues are serious but have relatively simple solutions.

First, it is wise to avoid public networks when paying. Instead using trusted private networks or cellular data prevents exposure to hackers. This is why people without data plans should probably have a physical backup card or cash on hand, but others just need to turn off the Wi-Fi and turn on data roaming before completing a transaction.

Second, using fundamental biometric security measures like face identification when unlocking one’s phone will likely be enough to prevent access to sensitive financial data. Even without a digital wallet on your phone, it’s essential to have biometric security features. Most digital wallets also allow users to set up multifactor authentication, which provides several additional validation nodes before access to a wallet is granted. If set up, multifactor authentication offers a level of security that a physical wallet can’t match.

Neither of these solutions requires a state regulator to get involved, as the only actual intervention necessary might be to browbeat consumers into setting up basic phone security features. Consumers already have the power to protect themselves from unwanted snooping and digital fraudsters, so why is the CFPB insisting on getting involved?

In truth, the CFPB made it very clear in their press release that they are more concerned with companies competing with digital wallets than consumers’ well-being. As stated, the CFPB believes that “Despite their impact on consumer finance, Big Tech and other nonbank companies operating in the payments sphere do not receive the same regulatory scrutiny and oversight as banks and credit unions.”

However, the CFPB’s press release provides no evidence that digital payment systems harm consumers. It only suggests that regulating them would “promote fair competition.” Promoting fair competition is not the mission of the CFPB. The Bureau’s official mission statement claims to protect consumers and take action against companies that break the law. Nothing in the statement involves leveling the playing field to promote competition.

Regulatory overreach by the CFPB degrades the institution’s purpose and leaves consumers and markets open to harm through unnecessary intervention. The Legislature is responsible for keeping these agencies in line and would be advised to investigate any misuse of agency time and funds outside their mission.

Isaac Schick is with the American Consumer Institute, a nonprofit education and research organization. For more information about the Institute, visit www.TheAmericanConsumer.Org or follow us on X @ConsumerPal.