Open banking must be a two-way street

Top Trends By American Banker Sep 7, 2021

In a new story, American Banker explores the question of who counts as a financial data provider to consumers — only banks — or also fintech companies?

The website notes that regulators in North America have already signaled they envision open finance as “multidirectional.”

However, they say that “the industry shouldn’t wait on rulemaking to deliver more value to consumers.”

“One of the strengths of open finance in the U.S. has been the industry’s drive to solve as much as it can in the market while anticipating regulations to reinforce what’s best for consumers,” they say, adding that “critically, some of the largest fintechs are investing in data-sharing capabilities, giving their customers more control of their data and more choices in their financial lives, and showing banks an early view of how they can benefit from an open finance world where data flows in both directions.”

The website concludes their piece with “as the industry awaits potential rules on financial data sharing, it faces two potential paths: continue with one-sided data sharing at increasing cost to consumers, or unlock consumer data from all financial services providers and build an ecosystem where consumers have more control and benefit from fair competition.”

“The choice for openness is clear,” is their final closing sentence.

This article was written by John Pitts and originally published on American Banker. A subscription may be required.