IC 28-1-23.5
Chapter 23.5. Electronic Activity by Financial Institutions
IC 28-1-23.5-1 Application of chapter
Sec. 1. This chapter applies to the following financial institutions:
(1) A bank operating under IC 28-1-11.
(2) A credit union operating under IC 28-7-1.
(3) A savings bank operating under IC 28-6.1.
(4) A savings association operating under IC 28-15. As added by P.L.10-2006, SEC.32 and P.L.57-2006, SEC.32.
IC 28-1-23.5-2 "Electronic activity"
Sec. 2. As used in this chapter, "electronic activity" refers to:
(1) any activity or function that a financial institution performs
through electronic means or facilities; or
(2) the provision or delivery of any product or service by a
financial institution through the use of electronic technology. As added by P.L.10-2006, SEC.32 and P.L.57-2006, SEC.32.
IC 28-1-23.5-3 Consistency with safety and soundness standards, consumer
protection laws, and supervisory guidance
Sec. 3. An electronic activity performed by a financial institution
must be consistent with the following:
(1) Standards used by the department to determine whether a
financial institution is operating or will operate in a safe and
sound condition.
(2) State and federal consumer protection laws and regulations.
(3) State or federal supervisory guidance considered necessary
or appropriate by the director. As added by P.L.10-2006, SEC.32 and P.L.57-2006, SEC.32.
IC 28-1-23.5-4 Electronic activities; statutory authorization; standards
Sec. 4. (a) The director may determine whether an electronic
activity by a financial institution is permitted under:
(1) IC 28-1-11, with respect to a bank;
(2) IC 28-7-1, with respect to a credit union;
(3) IC 28-6.1, with respect to a savings bank;
(4) IC 28-15, with respect to a savings association; or
(5) any other state statute that applies to a financial institution
described in subdivisions (1) through (4).
(b) The director may establish standards or conditions designed
to ensure that the electronic activities of financial institutions are:
(1) transacted as intended; and
(2) conducted safely and soundly, in accordance with other
applicable statutes, regulations, or supervisory policies. As added by P.L.10-2006, SEC.32 and P.L.57-2006, SEC.32. IC 28-1-23.5-5 Electronic activity authorized as part of financial institution's
business
Sec. 5. (a) An electronic activity is authorized for a financial
institution as part of the financial institution's business if the activity
is described in:
(1) IC 28-1-11, with respect to a bank;
(2) IC 28-7-1, with respect to a credit union;
(3) IC 28-6.1, with respect to a savings bank;
(4) IC 28-15, with respect to a savings association; or
(5) any other state statute that applies to a financial institution
described in subdivisions (1) through (4).
(b) In determining whether an electronic activity is authorized as
part of a financial institution's business, the director shall consider
the following:
(1) Whether the activity is functionally equivalent to, or a
logical outgrowth of, a recognized activity of the type of
financial institution under consideration.
(2) Whether the activity strengthens the financial institution by
benefiting its customers or its business.
(3) Whether the activity involves risks similar in nature to those
already assumed by the type of financial institution under
consideration.
(4) Whether the activity may be conducted by:
(A) the same, or functionally equivalent type, of federally
chartered financial institution; or
(B) the same, or functionally equivalent type, of financial
institution that:
(i) is organized or reorganized under the laws of another
state; and
(ii) does business in Indiana;
under the authority of applicable federal or state statutes,
regulations, or supervisory policies. As added by P.L.10-2006, SEC.32 and P.L.57-2006, SEC.32.
IC 28-1-23.5-6 Electronic activity incidental to financial institution's business
Sec. 6. (a) An electronic activity is authorized for a financial
institution as incidental to the financial institution's business if the
activity is convenient or useful to an activity that is:
(1) specifically authorized for the type of financial institution
under consideration; or
(2) otherwise part of the business of the type of financial
institution under consideration.
(b) In determining whether an electronic activity is authorized as
incidental to a financial institution's business, the director may
consider whether the activity:
(1) facilitates the production or delivery of the financial
institution's products or services;
(2) enhances the financial institution's ability to sell or market
its products or services;
(3) improves the effectiveness or efficiency of the financial
institution's operations; or
(4) enables the financial institution to:
(A) use capacity acquired for its operations as a financial
institution; or
(B) otherwise avoid economic loss or waste. As added by P.L.10-2006, SEC.32 and P.L.57-2006, SEC.32.
IC 28-1-23.5-7 Evaluation of potential risks; authorization to act
Sec. 7. (a) As used in this section, "potential risks", with respect
to a proposed electronic activity by a financial institution, include the
following:
(1) Legal risks.
(2) Transactional risks.
(3) Risk of the financial institution's noncompliance with
applicable statutes, regulations, or supervisory policies.
(4) Risk of harm to the financial institution's reputation.
(b) A financial institution's board of directors and executive
officers are responsible for ensuring that all potential risks are
evaluated and taken into account before the financial institution
undertakes any electronic activity. The board of directors and the
executive officers may not delegate their responsibility under this
subsection to other persons within the financial institution or to
outside parties.
(c) After a financial institution's board of directors and executive
officers have acted under subsection (b) to conduct an evaluation of
the potential risks associated with an electronic activity, the financial
institution may perform, provide, or deliver through electronic means
or facilities any activity, function, product, or service that it is
otherwise authorized to perform, provide, or deliver, subject to this
chapter and any other applicable statutes, regulations, or supervisory
policies. As added by P.L.10-2006, SEC.32 and P.L.57-2006, SEC.32.
IC 28-1-23.5-8 Activities authorized for national banks and federal credit unions
Sec. 8. (a) A financial institution described in section 1(1), 1(3),
or 1(4) of this chapter may perform, provide, or deliver through
electronic means or facilities any activity, function, product, or
service that a national bank is specifically authorized to perform,
provide, or deliver under 12 CFR 7.5000 et seq.
(b) A financial institution described in section 1(2) of this chapter
may perform, provide, or deliver through electronic means or
facilities any activity, function, product, or service that a federal
credit union is specifically authorized to perform, provide, or deliver
under Part 721 of the National Credit Union Administration's
regulations (12 CFR 721.1 et seq.). As added by P.L.10-2006, SEC.32 and P.L.57-2006, SEC.32. IC 28-1-23.5-9 Performing authorized or required activities through electronic
means
Sec. 9. A financial institution may perform, provide, or deliver
through electronic means or facilities any activity, function, product,
or service that it is otherwise authorized or required to perform,
provide, or deliver by nonelectronic means or facilities, subject to the
following:
(1) The approval of the customer or member to or for whom the
activity, function, product, or service is performed, provided, or
delivered.
(2) The:
(A) safety and soundness requirements; and
(B) state or federal supervisory guidance;
that the director would apply if the activity were conducted by
nonelectronic means or facilities. As added by P.L.10-2006, SEC.32 and P.L.57-2006, SEC.32.
IC 28-1-23.5
Chapter 23.5. Electronic Activity by Financial Institutions
IC 28-1-23.5-1 Application of chapter
Sec. 1. This chapter applies to the following financial institutions:
(1) A bank operating under IC 28-1-11.
(2) A credit union operating under IC 28-7-1.
(3) A savings bank operating under IC 28-6.1.
(4) A savings association operating under IC 28-15. As added by P.L.10-2006, SEC.32 and P.L.57-2006, SEC.32.
IC 28-1-23.5-2 "Electronic activity"
Sec. 2. As used in this chapter, "electronic activity" refers to:
(1) any activity or function that a financial institution performs
through electronic means or facilities; or
(2) the provision or delivery of any product or service by a
financial institution through the use of electronic technology. As added by P.L.10-2006, SEC.32 and P.L.57-2006, SEC.32.
IC 28-1-23.5-3 Consistency with safety and soundness standards, consumer
protection laws, and supervisory guidance
Sec. 3. An electronic activity performed by a financial institution
must be consistent with the following:
(1) Standards used by the department to determine whether a
financial institution is operating or will operate in a safe and
sound condition.
(2) State and federal consumer protection laws and regulations.
(3) State or federal supervisory guidance considered necessary
or appropriate by the director. As added by P.L.10-2006, SEC.32 and P.L.57-2006, SEC.32.
IC 28-1-23.5-4 Electronic activities; statutory authorization; standards
Sec. 4. (a) The director may determine whether an electronic
activity by a financial institution is permitted under:
(1) IC 28-1-11, with respect to a bank;
(2) IC 28-7-1, with respect to a credit union;
(3) IC 28-6.1, with respect to a savings bank;
(4) IC 28-15, with respect to a savings association; or
(5) any other state statute that applies to a financial institution
described in subdivisions (1) through (4).
(b) The director may establish standards or conditions designed
to ensure that the electronic activities of financial institutions are:
(1) transacted as intended; and
(2) conducted safely and soundly, in accordance with other
applicable statutes, regulations, or supervisory policies. As added by P.L.10-2006, SEC.32 and P.L.57-2006, SEC.32. IC 28-1-23.5-5 Electronic activity authorized as part of financial institution's
business
Sec. 5. (a) An electronic activity is authorized for a financial
institution as part of the financial institution's business if the activity
is described in:
(1) IC 28-1-11, with respect to a bank;
(2) IC 28-7-1, with respect to a credit union;
(3) IC 28-6.1, with respect to a savings bank;
(4) IC 28-15, with respect to a savings association; or
(5) any other state statute that applies to a financial institution
described in subdivisions (1) through (4).
(b) In determining whether an electronic activity is authorized as
part of a financial institution's business, the director shall consider
the following:
(1) Whether the activity is functionally equivalent to, or a
logical outgrowth of, a recognized activity of the type of
financial institution under consideration.
(2) Whether the activity strengthens the financial institution by
benefiting its customers or its business.
(3) Whether the activity involves risks similar in nature to those
already assumed by the type of financial institution under
consideration.
(4) Whether the activity may be conducted by:
(A) the same, or functionally equivalent type, of federally
chartered financial institution; or
(B) the same, or functionally equivalent type, of financial
institution that:
(i) is organized or reorganized under the laws of another
state; and
(ii) does business in Indiana;
under the authority of applicable federal or state statutes,
regulations, or supervisory policies. As added by P.L.10-2006, SEC.32 and P.L.57-2006, SEC.32.
IC 28-1-23.5-6 Electronic activity incidental to financial institution's business
Sec. 6. (a) An electronic activity is authorized for a financial
institution as incidental to the financial institution's business if the
activity is convenient or useful to an activity that is:
(1) specifically authorized for the type of financial institution
under consideration; or
(2) otherwise part of the business of the type of financial
institution under consideration.
(b) In determining whether an electronic activity is authorized as
incidental to a financial institution's business, the director may
consider whether the activity:
(1) facilitates the production or delivery of the financial
institution's products or services;
(2) enhances the financial institution's ability to sell or market
its products or services;
(3) improves the effectiveness or efficiency of the financial
institution's operations; or
(4) enables the financial institution to:
(A) use capacity acquired for its operations as a financial
institution; or
(B) otherwise avoid economic loss or waste. As added by P.L.10-2006, SEC.32 and P.L.57-2006, SEC.32.
IC 28-1-23.5-7 Evaluation of potential risks; authorization to act
Sec. 7. (a) As used in this section, "potential risks", with respect
to a proposed electronic activity by a financial institution, include the
following:
(1) Legal risks.
(2) Transactional risks.
(3) Risk of the financial institution's noncompliance with
applicable statutes, regulations, or supervisory policies.
(4) Risk of harm to the financial institution's reputation.
(b) A financial institution's board of directors and executive
officers are responsible for ensuring that all potential risks are
evaluated and taken into account before the financial institution
undertakes any electronic activity. The board of directors and the
executive officers may not delegate their responsibility under this
subsection to other persons within the financial institution or to
outside parties.
(c) After a financial institution's board of directors and executive
officers have acted under subsection (b) to conduct an evaluation of
the potential risks associated with an electronic activity, the financial
institution may perform, provide, or deliver through electronic means
or facilities any activity, function, product, or service that it is
otherwise authorized to perform, provide, or deliver, subject to this
chapter and any other applicable statutes, regulations, or supervisory
policies. As added by P.L.10-2006, SEC.32 and P.L.57-2006, SEC.32.
IC 28-1-23.5-8 Activities authorized for national banks and federal credit unions
Sec. 8. (a) A financial institution described in section 1(1), 1(3),
or 1(4) of this chapter may perform, provide, or deliver through
electronic means or facilities any activity, function, product, or
service that a national bank is specifically authorized to perform,
provide, or deliver under 12 CFR 7.5000 et seq.
(b) A financial institution described in section 1(2) of this chapter
may perform, provide, or deliver through electronic means or
facilities any activity, function, product, or service that a federal
credit union is specifically authorized to perform, provide, or deliver
under Part 721 of the National Credit Union Administration's
regulations (12 CFR 721.1 et seq.). As added by P.L.10-2006, SEC.32 and P.L.57-2006, SEC.32. IC 28-1-23.5-9 Performing authorized or required activities through electronic
means
Sec. 9. A financial institution may perform, provide, or deliver
through electronic means or facilities any activity, function, product,
or service that it is otherwise authorized or required to perform,
provide, or deliver by nonelectronic means or facilities, subject to the
following:
(1) The approval of the customer or member to or for whom the
activity, function, product, or service is performed, provided, or
delivered.
(2) The:
(A) safety and soundness requirements; and
(B) state or federal supervisory guidance;
that the director would apply if the activity were conducted by
nonelectronic means or facilities. As added by P.L.10-2006, SEC.32 and P.L.57-2006, SEC.32.
IC 28-1-23.5
Chapter 23.5. Electronic Activity by Financial Institutions
IC 28-1-23.5-1 Application of chapter
Sec. 1. This chapter applies to the following financial institutions:
(1) A bank operating under IC 28-1-11.
(2) A credit union operating under IC 28-7-1.
(3) A savings bank operating under IC 28-6.1.
(4) A savings association operating under IC 28-15. As added by P.L.10-2006, SEC.32 and P.L.57-2006, SEC.32.
IC 28-1-23.5-2 "Electronic activity"
Sec. 2. As used in this chapter, "electronic activity" refers to:
(1) any activity or function that a financial institution performs
through electronic means or facilities; or
(2) the provision or delivery of any product or service by a
financial institution through the use of electronic technology. As added by P.L.10-2006, SEC.32 and P.L.57-2006, SEC.32.
IC 28-1-23.5-3 Consistency with safety and soundness standards, consumer
protection laws, and supervisory guidance
Sec. 3. An electronic activity performed by a financial institution
must be consistent with the following:
(1) Standards used by the department to determine whether a
financial institution is operating or will operate in a safe and
sound condition.
(2) State and federal consumer protection laws and regulations.
(3) State or federal supervisory guidance considered necessary
or appropriate by the director. As added by P.L.10-2006, SEC.32 and P.L.57-2006, SEC.32.
IC 28-1-23.5-4 Electronic activities; statutory authorization; standards
Sec. 4. (a) The director may determine whether an electronic
activity by a financial institution is permitted under:
(1) IC 28-1-11, with respect to a bank;
(2) IC 28-7-1, with respect to a credit union;
(3) IC 28-6.1, with respect to a savings bank;
(4) IC 28-15, with respect to a savings association; or
(5) any other state statute that applies to a financial institution
described in subdivisions (1) through (4).
(b) The director may establish standards or conditions designed
to ensure that the electronic activities of financial institutions are:
(1) transacted as intended; and
(2) conducted safely and soundly, in accordance with other
applicable statutes, regulations, or supervisory policies. As added by P.L.10-2006, SEC.32 and P.L.57-2006, SEC.32. IC 28-1-23.5-5 Electronic activity authorized as part of financial institution's
business
Sec. 5. (a) An electronic activity is authorized for a financial
institution as part of the financial institution's business if the activity
is described in:
(1) IC 28-1-11, with respect to a bank;
(2) IC 28-7-1, with respect to a credit union;
(3) IC 28-6.1, with respect to a savings bank;
(4) IC 28-15, with respect to a savings association; or
(5) any other state statute that applies to a financial institution
described in subdivisions (1) through (4).
(b) In determining whether an electronic activity is authorized as
part of a financial institution's business, the director shall consider
the following:
(1) Whether the activity is functionally equivalent to, or a
logical outgrowth of, a recognized activity of the type of
financial institution under consideration.
(2) Whether the activity strengthens the financial institution by
benefiting its customers or its business.
(3) Whether the activity involves risks similar in nature to those
already assumed by the type of financial institution under
consideration.
(4) Whether the activity may be conducted by:
(A) the same, or functionally equivalent type, of federally
chartered financial institution; or
(B) the same, or functionally equivalent type, of financial
institution that:
(i) is organized or reorganized under the laws of another
state; and
(ii) does business in Indiana;
under the authority of applicable federal or state statutes,
regulations, or supervisory policies. As added by P.L.10-2006, SEC.32 and P.L.57-2006, SEC.32.
IC 28-1-23.5-6 Electronic activity incidental to financial institution's business
Sec. 6. (a) An electronic activity is authorized for a financial
institution as incidental to the financial institution's business if the
activity is convenient or useful to an activity that is:
(1) specifically authorized for the type of financial institution
under consideration; or
(2) otherwise part of the business of the type of financial
institution under consideration.
(b) In determining whether an electronic activity is authorized as
incidental to a financial institution's business, the director may
consider whether the activity:
(1) facilitates the production or delivery of the financial
institution's products or services;
(2) enhances the financial institution's ability to sell or market
its products or services;
(3) improves the effectiveness or efficiency of the financial
institution's operations; or
(4) enables the financial institution to:
(A) use capacity acquired for its operations as a financial
institution; or
(B) otherwise avoid economic loss or waste. As added by P.L.10-2006, SEC.32 and P.L.57-2006, SEC.32.
IC 28-1-23.5-7 Evaluation of potential risks; authorization to act
Sec. 7. (a) As used in this section, "potential risks", with respect
to a proposed electronic activity by a financial institution, include the
following:
(1) Legal risks.
(2) Transactional risks.
(3) Risk of the financial institution's noncompliance with
applicable statutes, regulations, or supervisory policies.
(4) Risk of harm to the financial institution's reputation.
(b) A financial institution's board of directors and executive
officers are responsible for ensuring that all potential risks are
evaluated and taken into account before the financial institution
undertakes any electronic activity. The board of directors and the
executive officers may not delegate their responsibility under this
subsection to other persons within the financial institution or to
outside parties.
(c) After a financial institution's board of directors and executive
officers have acted under subsection (b) to conduct an evaluation of
the potential risks associated with an electronic activity, the financial
institution may perform, provide, or deliver through electronic means
or facilities any activity, function, product, or service that it is
otherwise authorized to perform, provide, or deliver, subject to this
chapter and any other applicable statutes, regulations, or supervisory
policies. As added by P.L.10-2006, SEC.32 and P.L.57-2006, SEC.32.
IC 28-1-23.5-8 Activities authorized for national banks and federal credit unions
Sec. 8. (a) A financial institution described in section 1(1), 1(3),
or 1(4) of this chapter may perform, provide, or deliver through
electronic means or facilities any activity, function, product, or
service that a national bank is specifically authorized to perform,
provide, or deliver under 12 CFR 7.5000 et seq.
(b) A financial institution described in section 1(2) of this chapter
may perform, provide, or deliver through electronic means or
facilities any activity, function, product, or service that a federal
credit union is specifically authorized to perform, provide, or deliver
under Part 721 of the National Credit Union Administration's
regulations (12 CFR 721.1 et seq.). As added by P.L.10-2006, SEC.32 and P.L.57-2006, SEC.32. IC 28-1-23.5-9 Performing authorized or required activities through electronic
means
Sec. 9. A financial institution may perform, provide, or deliver
through electronic means or facilities any activity, function, product,
or service that it is otherwise authorized or required to perform,
provide, or deliver by nonelectronic means or facilities, subject to the
following:
(1) The approval of the customer or member to or for whom the
activity, function, product, or service is performed, provided, or
delivered.
(2) The:
(A) safety and soundness requirements; and
(B) state or federal supervisory guidance;
that the director would apply if the activity were conducted by
nonelectronic means or facilities. As added by P.L.10-2006, SEC.32 and P.L.57-2006, SEC.32.
