September 29, 2021, Washington, DC – Today, FDATA North America submitted a letter for the record for the U.S. House Financial Services Committee’s Subcommittee on Consumer Protection and Financial Institutions hearing “The Future of Banking: How Consolidation, Nonbank Competition, and Technology are Reshaping the Banking System.” The letter outlines FDATA North America’s mission to advocate for a financial ecosystem in which the end user has complete utility of their financial data.
Throughout the letter, FDATA North America Executive Director Steve Boms highlighted the steps necessary for the Consumer Financial Protection Bureau (CFPB) to promulgate, by rule, a customer financial data right that will spur greater financial services innovation and competition as well as improve consumer financial access and inclusion and the importance of the subcommittee in . “As the CFPB works to promulgate a proposed rule under Section 1033 of the Dodd-Frank Act to improve competition in the financial services system, we hope that the subcommittee will continue to examine this vitally important space and encourage the Bureau to use its statutory authority to create a customer-centric, safe, competitive, and secure open finance system in the United States,” Boms stated.
To accomplish the goal of leveling the playing field for consumers and small businesses, expanding financial access and inclusion, improving competition in the financial services marketplace and, on a global level, ensuring that the United States’ financial services system remains competitive internationally, FDATA North America outlined its recommendations to the Bureau that it utilize its Section 1033 authority to issue a rule that adheres to five key principles:
- Create a legally binding customer financial data right;
- Define and clear enumerate the limited circumstances in which custodians of financial data may override customer consent;
- Supervise financial data aggregation firms;
- Coordinate with the prudential regulators on Regulation E modernization; and
- Recognize the need to permit current and legacy technology
Boms noted that the combination of these principles “would provide consumers and small businesses with safe, secure access to their financial data and, by extension, to critically important financial applications and tools that can meaningfully improve their financial wellbeing.”
FDATA North America Letter for the Record on the Future of Banking
ABOUT FDATA NORTH AMERICA
FDATA was heavily involved in the UK Open Banking Working Group in 2015. In 2016, the working group’s output was published by Her Majesty’s Treasury as the Open Banking Standard. FDATA North America was founded in early 2018. Its members collectively provide tens of millions of consumers in Canada, the United States, and Mexico with aggregation-based tools to better manage their finances.
Members include air (Alliance for Innovative Regulation), APImetrics, Basis Theory, Betterment, BillGo, Codat, Direct ID, Envestnet Yodlee, Equitable Bank, Experian, Fiserv, Flinks, Interac, Intuit, Inverite, Kabbage, Mogo, Morningstsar, M Science, MX, Petal, Plaid, Questrade, Rocket Mortgage, SaltEdge, Trustly, ValidiFI, VoPay, Wealthica, Xero, and others.