Bill Overview
Title: EXPORT Act of 2022
Description: This bill exempts certain money transmitters from specified capital and margin requirements that otherwise apply to counterparty swaps. Specifically, these money transmitters must (1) only enter into swaps for the purpose of offsetting risks from foreign currency contracts with a non-end user, and (2) have annual assets of $1 billion or less.
Sponsors: Rep. Owens, Burgess [R-UT-4]
Target Audience
Population: Money transmitters involved in foreign currency contracts
Estimated Size: 2000
- The bill affects money transmitters who deal with foreign currency contracts, who are not end-users, and have annual assets of $1 billion or less.
- These money transmitters may be spread across various countries, as the bill pertains to international swap and currency trade.
- Exempting certain financial requirements for money transmitters may indirectly impact their clients and the broader market involved in foreign currency exchanges.
Reasoning
- Approximately 2000 money transmitters could be directly impacted in the U.S., affecting both their operations and possibly their clients.
- Most direct benefits will be financial and operational efficiencies from reduced capital requirements.
- Indirect effects could ripple out to individuals and businesses interacting with affected money transmitters, including small business owners, employees, and possibly consumers via foreign exchange savings.
- The population directly impacted is large enough to merit a spectrum of reactions; some might experience significant improvement while for others effects might be minimal or nonexistent.
- The policy targets a specific slice of the financial market, creating varied impacts depending on the degree of engagement with foreign currency contracts.
Simulated Interviews
Operations Manager at a Small Foreign Exchange Company (New York, NY)
Age: 35 | Gender: male
Wellbeing Before Policy: 6
Duration of Impact: 10.0 years
Commonness: 15/20
Statement of Opinion:
- The policy allows us to manage risks better without tying up so much capital in compliance. This should free up resources for expansion and possibly higher salaries.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 6 |
| Year 2 | 7 | 6 |
| Year 3 | 7 | 6 |
| Year 5 | 8 | 6 |
| Year 10 | 8 | 6 |
| Year 20 | 7 | 5 |
Financial Analyst (San Francisco, CA)
Age: 40 | Gender: female
Wellbeing Before Policy: 5
Duration of Impact: 5.0 years
Commonness: 10/20
Statement of Opinion:
- We might see slight optimizations in our operations but it's not significantly changing our strategic outlook immediately.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 5 | 5 |
| Year 2 | 6 | 5 |
| Year 3 | 6 | 5 |
| Year 5 | 6 | 5 |
| Year 10 | 5 | 5 |
| Year 20 | 5 | 5 |
Investor in Tech Startups (Chicago, IL)
Age: 50 | Gender: male
Wellbeing Before Policy: 7
Duration of Impact: 3.0 years
Commonness: 12/20
Statement of Opinion:
- This easing of capital requirements should foster a less constrained and thus more dynamic forex environment, which could be beneficial to my portfolio.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 7 |
| Year 2 | 7 | 7 |
| Year 3 | 8 | 7 |
| Year 5 | 8 | 7 |
| Year 10 | 7 | 7 |
| Year 20 | 6 | 6 |
Owner of an Import/Export Business (Miami, FL)
Age: 29 | Gender: female
Wellbeing Before Policy: 6
Duration of Impact: 2.0 years
Commonness: 13/20
Statement of Opinion:
- It's a relief if our money transmitter can pass along some cost savings, but I'm not expecting immediate or noticeable changes.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 6 |
| Year 2 | 6 | 6 |
| Year 3 | 7 | 6 |
| Year 5 | 7 | 6 |
| Year 10 | 6 | 6 |
| Year 20 | 5 | 5 |
Retired Banker (Dallas, TX)
Age: 62 | Gender: male
Wellbeing Before Policy: 5
Duration of Impact: 5.0 years
Commonness: 8/20
Statement of Opinion:
- It seems like a good move, reducing unnecessary financial burden. It could promote more competitive rates if savings are passed on.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 5 | 5 |
| Year 2 | 6 | 5 |
| Year 3 | 6 | 5 |
| Year 5 | 6 | 5 |
| Year 10 | 5 | 5 |
| Year 20 | 5 | 4 |
Risk Manager for a Regional Bank (Boston, MA)
Age: 45 | Gender: female
Wellbeing Before Policy: 5
Duration of Impact: 0.0 years
Commonness: 16/20
Statement of Opinion:
- We're unlikely to be directly affected, but observing effects on smaller counterparts could influence our competitive analysis.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 5 | 5 |
| Year 2 | 5 | 5 |
| Year 3 | 5 | 5 |
| Year 5 | 5 | 5 |
| Year 10 | 5 | 5 |
| Year 20 | 5 | 5 |
Owner of a Cryptocurrency Exchange (Seattle, WA)
Age: 38 | Gender: other
Wellbeing Before Policy: 6
Duration of Impact: 10.0 years
Commonness: 9/20
Statement of Opinion:
- Any reduction in regulatory expenses is beneficial, helping prioritize investment in technology and customer service.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 6 |
| Year 2 | 8 | 6 |
| Year 3 | 8 | 6 |
| Year 5 | 8 | 6 |
| Year 10 | 7 | 6 |
| Year 20 | 6 | 5 |
Logistics Manager (Atlanta, GA)
Age: 28 | Gender: male
Wellbeing Before Policy: 6
Duration of Impact: 3.0 years
Commonness: 14/20
Statement of Opinion:
- Any cost reduction along the chain is good but the effect might be diluted by the time it reaches us.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 6 |
| Year 2 | 6 | 6 |
| Year 3 | 7 | 6 |
| Year 5 | 7 | 6 |
| Year 10 | 6 | 6 |
| Year 20 | 5 | 5 |
Foreign Exchange Trader (Los Angeles, CA)
Age: 34 | Gender: female
Wellbeing Before Policy: 7
Duration of Impact: 5.0 years
Commonness: 11/20
Statement of Opinion:
- This could increase the volume and volatility of transactions, creating more trading opportunities but also greater risks.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 8 | 7 |
| Year 2 | 8 | 7 |
| Year 3 | 9 | 7 |
| Year 5 | 8 | 7 |
| Year 10 | 7 | 7 |
| Year 20 | 6 | 6 |
CEO of a Small Online Payment Platform (Miami, FL)
Age: 36 | Gender: male
Wellbeing Before Policy: 6
Duration of Impact: 7.0 years
Commonness: 9/20
Statement of Opinion:
- This policy relieves some of our compliance stress, and we’re hoping to reinvest savings into R&D.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 6 |
| Year 2 | 8 | 6 |
| Year 3 | 8 | 6 |
| Year 5 | 8 | 6 |
| Year 10 | 7 | 6 |
| Year 20 | 6 | 5 |
Cost Estimates
Year 1: $1000000 (Low: $800000, High: $1200000)
Year 2: $1000000 (Low: $800000, High: $1200000)
Year 3: $1000000 (Low: $800000, High: $1200000)
Year 5: $1000000 (Low: $800000, High: $1200000)
Year 10: $1000000 (Low: $800000, High: $1200000)
Year 100: $1000000 (Low: $800000, High: $1200000)
Key Considerations
- The policy primarily affects small-scale international money transmitters, thus its economic effects are highly localized.
- Changes in compliance costs could have a slight positive impact on market liquidity in the money transmission sector.