Definition
An industrial bank charter (industrial loan company / ILC) is a U.S. state-chartered banking license — commonly sought in Utah — that allows non-bank parent companies to own FDIC-insured institutions with restrictions on certain commercial lending activities compared to full national banks.
Key Points
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2026-07-31: Related state track — circle nydfs limited-purpose-trust-charter complements federal OCC trust (not an industrial bank charter) (2026-07-31-circle-nydfs-trust-charter)
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Fintech route: klarna, Affirm, PayPal, and others have pursued or hold industrial bank charters
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Requires dual approval: state regulator (e.g., Utah DFI) + FDIC deposit insurance
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Enables in-house payments, savings, credit, and merchant services without full national bank conversion
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Subject to heightened regulatory scrutiny; approval timelines uncertain