OPEN FINANCE Archives - Page 2 of 3 - Financial Data and Technology Association (FDATA)

September 20, 2021by rebecca rebecca No Comments

FDATA North America Submits Comments to House Fintech Task Force on Data Access

September 20, 2021, Washington, DC – Today, FDATA North America submitted a letter for the record for the U.S. House Financial Services Committee’s Task Force on Financial Technology’s hearing “Preserving the Right of Consumers to Access Personal Financial Data.” 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 discussed the importance of the Consumer Financial Protection Bureau (CFPB) utilizing the authority vested in it under Section 1033 of the Dodd-Frank Wall Street Reform and Consumer Protection Act to promulgate, by rule, a consumer financial data right that will spur greater financial access and inclusion. “FDATA North America has been encouraged by two important developments” that advance Section 1033, including:

The issuance of an advance notice of proposed rulemaking by the [Consumer Financial Protection] Bureau (CFPB) pertaining to consumer access to financial records late last year; and
Inclusion in President Joe Biden’s July 2021 Executive Order on Promoting Competition in the American Economy language that encourages the CFPB to consider “commencing or continuing a rulemaking under section 1033 to facilitate the portability

Promulgation of Section 1033, Boms stated, comes at a critical moment whereby countries around the world are quickly embracing the notion that the customer should be in control of their own financial data. “The status quo, under which financial institutions continuously exercise control over their customers’ data, provides little benefit to the consumer or small business,” Boms noted. Additionally, innovation and competition in the financial services marketplace are stifled under the current environment that is controlled by commercial interests, prohibits the move to a modernized customer-centric, safe and secure open finance system in the United States.

FDATA North America Letter for the Record on Data Access

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.

August 3, 2021by rebecca rebecca No Comments

FDATA North America Submits Comments to Canada’s Standing Committee on Finance Pre-2022 Budget Consultations

August 3, 2021, Washington, DC – Today, the Financial Data and Technology Association (FDATA) of North America submitted comments to Canada’s Standing Committee on Finance (FINA) as part of its pre-budget consultations in advance of the 2022 budget.

In its comments, FDATA North America called on the government to fully embrace a digital-first future for its financial sector as well as a consumer-centric model for its privacy arena, and pointed to a customer-directed finance (CDF) environment as a cornerstone of this future system. This new legal framework will “improve access to financial services, ensure a more level regulatory system for financial service providers, improve competitiveness, and foster innovation, all of which will contribute to health and sustained macroeconomic growth.”

To achieve a modernized open finance system that mitigates risks and protects consumers and small businesses by ensuring that providers’ privacy protections meet regulatory standards, that customer privacy is assured regardless of whether their chosen service provider is a financial institution or non-bank fintech, and recourse mechanisms to make consumers affected by a data breach whole, FDATA North America suggests that the government should include language in Budget 2022:

implementing a CDF regime that include clear definitions of consumer and small business financial data rights, scope, and portability; and
to enshrine a new CDF Implementation Entity (IE) tasked with the design and implementation of open finance in Canada.

Without this framework, Canada will remain in a financial status quo where consumers and other end users lack control of their personal information and cannot benefit from financial innovation. By delaying this approach, FDATA North America argues that Canada risks falling further behind as a world leader in digital innovation and misses an opportunity to provide cutting-edge financial services to its consumers and small businesses.

FDATA North America Submission for the Pre-Budget Consultations in Advance of the Upcoming Federal Budget

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, Marble, Mogo, Morningstsar, M Science, MX, Petal, Plaid, Questrade, Quicken Loans, SaltEdge, Trustly, ValidiFI, VoPay, Wealthica, Xero, and others.

July 9, 2021by rebecca rebecca No Comments

FDATA North America: White House EO Will Help Individuals, Families and Small Businesses Recovering From Pandemic

Contact: Kerrie Rushton, (202) 365-6338, [email protected]

July 9, 2021, Washington, DC – The Financial Data and Technology Association (FDATA) of North America today issued a statement following the release of President Joe Biden’s Executive Order on financial competition. In the order, the president directs the Consumer Financial Protection Bureau (CFPB) to issue a regulation that would allow bank customers to have access to, and share, their own financial data. FDATA North America Executive Director Steve Boms said:

“Today’s Executive Order represents a significant step forward for consumers and small business towards an open finance regime in the United States. Coming out of a pandemic and recession, a CFPB rule will improve financial inclusion, enhance customers’ access to affordable credit, and help families and businesses improve their financial wellbeing.

This order also will help create a customer-centric, 21st century financial services marketplace that boosts competition. Major markets around the world have implemented or are designing open finance regimes. U.S. consumers must not be left behind and, today, the White House is one step closer to making sure that they are not. FDATA North America and its members are eager to work with the CFPB and the Biden administration to implement this incredibly important regulation.”

Members include: air (Alliance for Innovative Regulation), APImetrics, Betterment, BillGO, Codat, Direct ID, Envestnet Yodlee, EQ Bank, Experian, Fiserv, Flinks, Interac, Intuit, Inverite, Kabbage, Mogo, Morningstsar, M Science, MX, Petal, Plaid, Questrade, Quicken Loans, SaltEdge, Trustly, ValidiFI, VoPay, Wealthica, Xero, and others.

June 29, 2021by rebecca rebecca No Comments

FDATA North America Submits Comments to US Financial Regulators’ Request for Information on Financial Institutions’ Use of AI and ML

June 29, 2021, Washington, DC – Today, the Financial Data and Technology Association (FDATA) of North America submitted comments to the US financial regulators as part of their Request for Information (RFI) on financial institutions’ use of artificial intelligence (AI), including machine learning (ML). The Federal Reserve, Consumer Financial Protection Bureau (CFPB), Federal Deposit Insurance Corporation (NCUA), National Credit Union Administration (NCUA), and Office of the Comptroller of the Currency (OCC) sought comments on the use of AI by financial institutions and their products and services to consumers.

Throughout the submission, FDATA North America Executive Director Steve Boms discussed the importance of embracing new technologies that improve customer experience and foster innovation. Additionally, Boms noted that “as nations around the world adapt to modernized open finance regime in which the consumer and small business have the unfettered ability to access and share their financial data with companies of their choosing, financial institutions and service providers are quickly embracing AI to attract and retain their customers, expand access to credit and improve financial access, and combat financial crime.”

Boms concluded by underscoring that “the promulgation of a legally binding financial data right is a critical first step towards broader deployment of AI-enabled financial tools that can meaningfully improve financial access and wellbeing,” along with more clarity from the agencies regarding the application of existing supervisory expectations on third-party bank partners that utilize AI-enabled tools for various financial products and services.

FDATA North America Submission to Financial Regulators’ AI/ ML RFI

Members include air (Alliance for Innovative Regulation), APImetrics, Betterment, BillGo, Codat, Direct ID, Envestnet Yodlee, EQ Bank, Experian, Fiserv, Flinks, Interac, Intuit, Inverite, Kabbage, Mogo, Morningstsar, M Science, MX, Petal, Plaid, Questrade, Quicken Loans, SaltEdge, Trustly, ValidiFI, VoPay, Wealthica, Xero, and others.

April 6, 2021by rebecca rebecca No Comments

FDATA North America Welcomes Three New Members

Contact: Kerrie Rushton, (202) 365-6338, [email protected]

April 6, 2021, Washington, DC – The Financial Data and Technology Association (FDATA) of North America today announced it has added three new members—BillGO, Codat, and ValidiFI— boosting the organization’s roster of member companies and organizations to 28.

“We’re excited to add BillGO, Codat, and ValidiFI to the growing list of companies united in their belief that that consumers and small businesses should have full control over their own financial data,” said FDATA North America Executive Director Steve Boms. “Financial technology companies are well positioned to help individuals, families, and small businesses improve their financial well-being as they fight their way out of the global economic crisis caused by COVID. Open finance maximizes the potential of fintech to improve financial access and inclusion, and BillGO, Codat, and ValidiFI will be important allies in this effort.”

Boms outlined how consumer-directed finance will improve financial inclusion in a recent Morning Consult op-ed.

The following organizations recently joined FDATA North America:

BillGO is an award-winning real-time bill management and payments platform that serves more than 30 million consumers and thousands of financial institutions, fintechs, and billers. Visit them at https://www.billgo.com.
Codat empowers more small businesses around the globe by ensuring their systems and services are interconnected, allowing them to harness their data to access bespoke products. Visit them at https://www.codat.io.
ValidifI is a technology company that delivers data and payment solutions for companies in the financial services industry and provides insights that help them improve the payment process. Visit them at https://validifi.com.

These firms discussed the importance of FDATA North’s mission to advance data access and open banking in North America:

BillGO: “Because BillGO believes everyone deserves access to a healthy financial future, we’re thrilled to join the FDATA and work alongside other organizations that share that commitment,” said Jay Plueger, SVP Alliances and Corporate Development at BillGO. “We look forward to collaborating with the FDATA and its members to shape standards and principles that advance our industry while protecting the interests of consumers.”
Codat: “At Codat, we are delighted to lend our voice to discussion on the future of open finance in North America. Joining FData North America aligns with our mission to enable all the systems and services that an SMB uses to work together seamlessly and underscores our strategic focus and growth plans in the region.” – Gabriel MacSweeney, Strategic Partnerships & Commercial Strategy
ValidiFI: “Access and insight into the rapidly changing regulatory environment for open banking and finance is crucial,” stated Jesse Berger, ValidiFI President and Chief Operating Officer. “It is vital for the development of innovative financial data and technology products like those offered by ValidiFI and other FDATA members. With FDATA’s support, members are ensuring financial products give consumers and businesses more choices, competitive service offerings, and a better deal.”

Existing FDATA North America members include: air (Alliance for Innovative Regulation), APImetrics, Betterment, Direct ID, Envestnet Yodlee, EQ Bank, Experian, Fiserv, Flinks, Interac, Intuit, Kabbage, Mogo, Morningstsar, M Science, MX, Petal, Plaid, Questrade, Quicken Loans, TransUnion, Trustly, VoPay, Wealthica, Xero, and others.

March 30, 2021by rebecca rebecca No Comments

Member Spotlight: ValidiFI

Can open finance positively impact the traditional financial services sector? ValidiFI has proven it can.

ValidiFI is a technology company that delivers data solutions to business and financial service providers. Simply: through a combination of technology and strategic partnerships, ValidiFI creates better ways to validate and analyze customer information.

ValidiFI’s data—which is sourced from banks, payment processors, financial platforms, and hundreds of thousands of businesses—comprises the most comprehensive lake of financial information in the industry. Financial services firms harness the data to improve account openings, credit decisions, payment processing, fraud detection, and risk segmentation. Businesses of every size—from new startups to public companies—use ValidiFI solutions to increase sales and facilitate payments.

Take managing underwriting and risk, for example.

It is becoming increasingly difficult for financial institutions to properly segment their applicants while identifying who will be a good and bad customer. ValidiFI’s alternative data solutions help firms identify and segment the risk of applicants based on their employment, income, and bank data. ValidiFI’s Payment Instrument (PI) Risk Score analyzes thousands of attributes to enhance the financial profile of the consumer, helping to mitigate fraud, reduce defaults, and reduce returns.

ValidiFI’s tools also help financial services firms stay compliant with government and organizational regulations. Using Bank Account Validation (BAV), firms can adhere to the Consumer Financial Protection Bureau’s payment provisions. ValidiFI also offers comprehensive Account Validation services to help maintain compliance with Nacha’s WEB Debit Rule.

According to ValidiFI, accessing a greater range of data is essential as the United States and Canada climb their way out of the COVID-19 health and economic crisis. ValidiFI said companies that are able to adapt to change by utilizing alternative underwriting methods and data, for example, will recover and advance more successfully.

ValidiFI joined FDATA North America in March 2021.

President and Chief Operating Officer Jesse Berger said, “Access and insight into the rapidly changing regulatory environment for open banking and finance is crucial. It is vital for the development of innovative financial data and technology products like those offered by ValidiFI and other FDATA members. With FDATA’s support, members are ensuring financial products give consumers and businesses more choices and competitive service offerings.”

March 15, 2021by rebecca rebecca No Comments

FDATA North America Sends Letter to Canada’s Department of Finance on Next Steps in Delivery of CDF

March 15, 2021, Washington, DC – Today, the Financial Data and Technology Association (FDATA) of North America submitted comments to Canada’s Department of Finance outlining its key recommendations for next steps in the deliver of Customer-Directed Finance (CDF).

Following the conclusion of the second phase of the CDF advisory committee’s consultations at the end of last year, FDATA North America Executive Director Steve Boms encourages the Department to advance the process of implementing a CDF system in Canada this year by:

Appointing a full-time, senior staffer at the Department as soon as possible whose sole responsibility will be to oversee the design and delivery of a CDF regime in Canada; and
Creating a CDF Implementation Entity tasked with the policy design and implementation of open finance in Canada.

Boms noted that FDATA North America and its members “are committed to seeing CDF become a reality for the benefit of Canadian consumers and SMEs. To achieve this goal, and to provide industry with the policy framework under which such a regime can be delivered, we respectfully encourage the Department to begin implementation of a CDF in Canada by appointing a senior staffer within the Department to be responsible for the delivery of CDF and by creating the CDF Implementation Entity as soon as possible.”

FDATA North America Submission to the Department of Finance

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. Existing FDATA North America members include: air (Alliance for Innovative Regulation), API Metrics, Betterment, Codat, Direct ID, Envestnet Yodlee, EQ Bank, Experian, Fiserv, Flinks, Interac, Intuit, Kabbage, Mogo, Morningstsar, M Science, MX, Petal, Plaid, Questrade, Quicken Loans, TransUnion, Trustly, ValidiFI, VoPay, Wealthica, Xero, and others.

February 3, 2021by rebecca rebecca No Comments

FDATA North America Responds to US CFPB ANPR on Consumer Access to Financial Records

February 3, 2021, Washington, DC – Today, FDATA North America submitted comments to the US Consumer Financial Protection Bureau (CFPB) in response to its Advanced Notice of Proposed Rulemaking (ANPR) regarding consumer access to financial records, or Section 1033 of the Dodd-Frank Wall Street Reform and Consumer Protection Act.

In the submission, FDATA North America Executive Director Steve Boms praised the CFPB for formally beginning the process of crafting a rule in this critically important area following many years of careful examination of the customer-permissioned data access and financial services ecosystems. “FDATA North America strongly supports the authority given to the CFPB by Congress in 2010 to promulgate, by rule, a consumer financial data right that will spur greater financial services innovation and competition and improve consumer financial access and inclusion,” Boms noted.

Boms concluded the association’s submission by encouraging the Bureau “to fully utilize its Section 1033 authority to create a customer financial data right to allow consumers and small businesses to have unrestricted access to technology-based tools that can help them improve their financial wellbeing, along with other important bedrocks of an open finance regime.”

FDATA North America CFPB ANPR Submission

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. Existing FDATA North America members include: air (Alliance for Innovative Regulation), API Metrics, Betterment, Direct ID, Envestnet Yodlee, EQ Bank, Experian, Fintech Growth Syndicate, Fiserv, Flinks, Interac, Intuit, Kabbage, Mogo, Morningstsar, M Science, MX, Petal, Plaid, Questrade, Quicken Loans, TransUnion, Trustly, ValidiFI, VoPay, Wealthica, Xero, and others.

November 17, 2020by rebecca rebecca No Comments

FDATA North America Outlines the Negative Consequences of Mandating a 90-Day Reauthentication Requirement

November 17, 2020, Washington, DC – In response to ongoing discussions by large U.S. financial institutions and some policymakers to impose a mandatory 90-day reauthentication requirement for customers wishing to utilize third-party financial tools, the Financial Data and Technology Association (FDATA) of North America today released a paper that outlines the detrimental impact this requirement would have based on the real-world experience of consumers in the European Union and United Kingdom whose access to financial technology tools is hindered by a similar requirement.

FDATA North America provides insight into how a mandatory 90-day reauthentication requirement has had the following impacts in other markets:

Resulted in the percent of customers no longer able to access a financial technology tool spiking from 6.6 percent prior to the implementation of the mandate to 44 percent afterwards;
Forced a frustrating experience upon the customer that can result in them abandoning use of an otherwise valuable tool as their connection to the tool repeatedly breaks; and
Imposed onerous requirements for customers who have accounts with multiple institutions to reauthenticate with each different institution every 90 days to access tools of their choice.

Mandating reauthentication events at least once every 90 days harms customers by aggravating their experience and unnecessarily hindering marketplace competition. The goal of an open finance system is to provide customers with control over their own financial data such that they can choose the products and services that best suit their needs. FDATA North America asserts that full customer control of financial data is the single best way to ensure good stewardship of that data.

FDATA North America Paper on the Negative Consequences of Mandating a 90-Day Reauthentication Requirement

November 11, 2020by rebecca rebecca No Comments

Member Spotlight: APImetrics

Headquartered in Seattle, FDATA North America member APImetrics offers the fintech industry’s only intelligent, analytics-driven API performance solution built specifically for the enterprise. By interfacing with all current and legacy API protocols, APImetrics helps companies to know if their APIs are performing as designed. Clients include Microsoft, Philips Signify, leading global banks, and mobile telephone carriers.

Still wondering what an API is? APImetrics has the answer (of course).

According to a company blog post, the term application programming interface (API) was first used in 1968, but meant something a bit different than it does today since in 1968 there was no World Wide Web. Regardless of its evolution, APIs make programming – any kind of programming, according to APImetrics – easier by abstracting out the details of what goes on at both sides of request/response pair. (A request/response pair could be a lot of things, but the easiest way to think about it might be a financial transaction – where there are two sides, both making decisions.)

In today’s world, APIs can tell us a lot about how individuals use everything from social media to e-commerce websites to online banking applications.

And, as APImetrics explained, APIs also can tell us a lot about the spread of viruses like COVID-19. The website covid19api.com, for example, provides an API that allows users easy access to a range of up-to-date data about the virus and how it is traveling.

Even if this information would have been available a century ago during the 1918 influenza outbreak, it would have taken years to assemble. As APImetrics said, “In the past, the required information might have been hidden away in paper documents stored in a filing cabinet somewhere. Whether the information was needed by an organization or someone from outside, getting hold of it was often a slow and unreliable process. Even when information eventually started to be stored electronically, finding it was still often a frustrating and time-consuming experience. But now with the advent of the API, organizations can provide a structured way for users to discover and consume easily, conveniently, and quickly the exact information they need.”

And how would Open Finance improve the data consumers, small businesses, and financial institutions can derive from APIs? CEO David O’Neill responds:

“There are two parts to that. The first is by making sure that the APIs themselves work as documented. There is nothing more frustrating or worse for an eco-system than not being able to get the APIs to actually work in the first place.

“The second is to ensure that they enable that eco-system with consistent, accurate, and fast data that can help create the next generation of financial services. The explosion in open banking isn’t just about making it easier to access services; it’s about creating new services that build on what we have. We have had taxis for over a century, but Uber and Lyft are new. With open banking, the ENTIRE financial service sector benefits when the next ‘Uber of finance’ appears.”