FDATA North America September Newsletter

by rebecca

FDATA North America Monthly Newsletter for September 2024

Welcome to FDATA North America’s monthly newsletter! These regular dispatches will share developments from our organization and our 30+ member companies, all of which are promoting financial access and inclusion with open finance use cases. We also include a list of upcoming industry events, and coverage of any market developments that impact fintech innovators. Know someone who’d like to receive these monthly updates? Send them here to sign up.

FDATA North America News

FDATA North America Submits Comments to the CFPB’s Medical Debt Rule. On August 5, 2024, the Financial Data and Technology Association of North America (FDATA) submitted a comment in response to the Consumer Financial Protection Bureau’s (CFPB) proposed rule aimed at limiting creditors from using information on medical debts for credit eligibility determinations under the Fair Credit Reporting Act (FCRA). While FDATA North America did not take a position on the rule’s underlying merits, it raised significant operational concerns regarding the practical implementation of the rule for consumer-permissioned open banking platforms that function as Consumer Reporting Agencies (CRAs). FDATA North America emphasized that without a mandatory requirement for data providers to identify medical debts, the current lack of a uniform mechanism for open banking platforms to identify whether an account connected by a consumer is a medical debt presents a major compliance challenge. To comply effectively with the CFPB’s proposed rule, FDATA North America urged the Bureau to require lenders to affirmatively identify accounts as medical debts whenever consumers grant data access to third-party platforms. This requirement is crucial for ensuring that open banking platforms, regulated as CRAs, have access to the same account information available in the traditional CRA space. FDATA released a statement on its submission of the letter, which can be found here.

Member News & Activity

ByAllAccounts published a blog discussing how the rapidly evolving wealthtech landscape offers opportunities for financial advisors and wealth management firms, despite the challenges posed by a fragmented tech ecosystem. The ByAllAccounts Data Network provides a streamlined solution by simplifying data exchange and integration, allowing wealthtech platforms to focus on innovation and growth rather than the complexities of data management.

Flinks published a blog summarizing a live session on building an efficient payments strategy by balancing cost, risk, and conversion. The session highlighted the fragmented payments landscape in Canada and emphasized the importance of finding the right balance between these three pillars to optimize payments strategy, with insights on future trends and advancements in payment technologies.

MX published a blog emphasizing the importance of secondary use cases in consumer financial health, particularly in light of the CFPB’s upcoming rule under Section 1033. The blog highlights concerns from a bipartisan group of Congress members about the potential negative impacts of restricting secondary data use, including stifling innovation, limiting fraud prevention, and disadvantaging smaller institutions.

Plaid published a blog highlighting five ways its open banking platform simplifies international expansion between Europe and North America. The blog emphasizes Plaid’s consistent APIs, extensive financial institution coverage, regulatory compliance, localized support, and scalable infrastructure, all designed to help fintech companies efficiently navigate and succeed in new markets.

Pontera posted a blog emphasizing that market volatility provides an opportunity for financial advisors to actively manage clients’ retirement plans and investment portfolios. The blog highlights the importance of proactive management during uncertain times, particularly as the market is expected to fluctuate leading up to the presidential election, ensuring that clients stay focused on their long-term financial goals.

Propel announced that its app, Providers, has been rebranded to align with the company’s name, now both known as Propel. This rebrand marks a decade of growth and innovation, reflecting Propel’s ongoing mission to support low-income Americans with tools like the Propel Card, Benefits Hub, and Job Board, all while continuing to advocate for financial security and dignity for their users.

TransUnion published a blog announcing its partnership with Snowflake to launch TruIQ Data Enrichment on the Snowflake Marketplace, providing on-demand access to pseudonymized TransUnion credit data within the Snowflake AI Data Cloud. This partnership enables organizations to efficiently link credit data with first and third-party datasets, enhancing data-driven insights while maintaining data security and minimizing data movement across platforms.

Trustly’s Founder and CEO, Alexandre Gonthier, wrote an op-ed featured in the American Banker, where he expressed concerns about the CFPB’s proposed Section 1033 rule, particularly the inclusion of tokenized account numbers (TANs). Gonthier warned that TANs could create barriers for smaller financial institutions, increase fraud risks, and lead to consumer confusion. He urged the CFPB to reconsider the inclusion of TANs to protect competition, consumer choice, and the security of financial transactions.

ValidFi posted a blog discussing the challenge of balancing customer experience with fraud prevention in today’s competitive landscape. The blog emphasizes the importance of using layered fraud protection solutions while clearly communicating the benefits to customers, ensuring they feel secure and understand the value of sharing their personal information.

Events and Submission Deadlines

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