On 26 March 2021, the FCA published a Feedback Statement to its Call for Input on open finance.
The FCA published its Call for Input in December 2019. It reports that it received 169 responses.
The responses show that open finance could potentially offer significant benefits to consumers but also create or increase risks and raise new questions of data ethics. It could also be a significant undertaking for firms which may be particularly important given the change in operating environment as a result of COVID-19 and its ongoing impact. There is also a degree of consensus around the key building blocks needed for open finance to develop in the interests of consumers. These include a legislative and regulatory framework, common standards and an implementation entity.
The FCA states that as open finance develops it wants to help ensure that:
- The needs of consumers are considered from the outset, including vulnerable and digitally excluded consumers.
- Systems and standards are designed with the consumer in mind.
- The right incentives and conditions exist for open finance to develop sustainably.
The FCA also notes that the Government has said that it will legislate to require participation in Smart Data but more work is needed to confirm the timing, scope and nature of the legislation.
The FCA has a role to play as it is the regulator of those firms that would be required to share data under any future legislation. It will do this through:
- Sharing lessons from the implementation and supervision of open banking and the development of Pensions Dashboards (these will enable consumers to access data about all their pensions in one place), including as part of the Department for Business, Energy and Industrial Strategy’s Smart Data Working Group.
- Working with the Government and industry stakeholders to identify what industry roadmaps are needed to support legislation.
- Helping convene industry-led efforts to develop common standards to support open finance.
- Assessing the regulatory framework that would be needed to support open finance.
- Supporting discussions on the future operating model for the Open Banking Implementation Entity.