Barr is a former Obama and Clinton administration official and is currently at the University of Michigan.
"Michael brings the expertise and experience necessary for this important position at a critical time for our economy and families across the country," Biden said in a statement.
"Barr has spent his career protecting consumers, and during his time at Treasury, played a critical role in creating both the Consumer Financial Protection Bureau and the position for which I am nominating him."
Raskin, Biden's previous pick for the Federal Reserve's top banking regulator, withdrew her nomination last month, according to a source familiar with the matter, after Republicans and one key Democrat opposed her nomination.
In a letter to Biden obtained by the New Yorker, Raskin blamed "relentless attacks by special interests," who opposed her view that climate change could pose a threat to economic stability, for derailing her nomination.