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In the wake of the Consumer Financial Protection Bureau’s decision to ditch its open banking rule, the American Fintech Council (AFC) has called on the regulator to preserve people’s right to access and share their financial data.
Editorial
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The CFPB only published the Personal Financial Data Rights final rule in October, giving Americans the right to instruct their banks to share their financial data with third party providers.
Yet by May, with a new US administration in place, the watchdog moved to petition a court to have the 1033 open banking rule rescinded.
The plan had long proved unpopular with many in the traditional financial industry and banks have taken advantage of the change in administration to raise concerns about potential liability for data breaches and the ability to charge for access to data.
But in a comment letter to the CFPB, the AFC calls on the bureau to preserve consumers’ right to access and share their financial data, prohibit data access fees, and ensure the United States remains a global leader in open banking.
Fees have emerged as a major concern for the fintech sector: In September, Plaid caved into demands by JPMorgan to pay for access to customer data, after the US bank accused aggregator firms of ‘massively taxing’ its systems with unnecessary pings.
“Consumers have a right to control their own financial data, and use it to access the financial tools that work best for them,” says Phil Goldfeder, CEO, ADC. “Imposing fees on consumer data is a direct threat to responsible innovation, competition, and the millions of Americans who rely on responsible fintech tools to manage their finances each day.”
The AFC’s comments echo those made by the Financial Technology Association, which called the move to kill off the rule a “handout to Wall Street banks”.
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