Antitrust for the fintech era

Abstract The emerging relationship between fintechs and banks has revealed antitrust's antiquation. At one time, scholars predicted that fintechs could democratize banking while providing a critical source of competition. But then banks began to acquire their digital rivals: about 900 acquisitions of fintechs have taken place since 2021. By merging or partnering, banks have squelched competition in an already concentrated market. Antitrust's absence in bank‐fintech deals is additionally curious because enforcers recognize that digital platforms such as fintechs are prone to monopolization. Despite this landscape, enforcers have asserted that the rise of fintechs should make antitrust even more deferential to bank mergers. The problem is that antitrust law adheres to an orthodox brand of economic theory about how people ostensibly behave. At its root, antitrust cannot intervene in most scenarios because rational actors are supposed to correct markets. This article shows that consumers in the digital era cannot always detect or mitigate their injuries, suggesting that antitrust is underenforced in fintech and other innovative sectors. Just as troublesome is the outdated assumption that consumers suffer harm as a collective group. With digital markets, anticompetitive conduct may injure only certain people such as low‐income persons. Recognizing these issues, the Department of Justice (DOJ) and Federal Trade Commission (FTC) issued new merger guidelines that seem to jettison outdated assumptions about when markets will self‐correct. The primary assertion of this article is that to preserve the promise of fintech and its ability to democratize financial services, the courts should embrace the agencies’ new approach.