A group of US House Representatives have sent a letter to the Consumer Financial Protection Bureau (CFPB) requesting the agency revise use of personal data.
Led by Representatives Mike Flood, Brittany Pettersen, Erin Houchin, and ten other Representatives, the letter notes that the Personal Financial Data Rights proposed rule is intended to implement section 1033 of the Dodd-Frank Act, directing the CFPB to ensure that a consumer financial services provider makes that consumer’s financial data available for their own use.
Representative Flood said it is important that consumers control their own data – a key aspect of Open Banking innovation.
Representative Houchin added that data is currency and consumers must retain control.
“We must ensure that our pursuit of consumer protection does not inadvertently lead to reduced benefits, diminished competition, or heightened risks of fraud.”
The letter states:
“…we respectfully urge you to revise provisions of the proposed rule which we believe could hinder the Bureau’s efforts to enhance consumers’ control of their financial lives and promote competition in financial services. Specifically, we are concerned significant restrictions on the secondary use of data could discourage the advancement of innovations that benefit consumers and small businesses by curbing basic product improvements and the development of tools to fight fraud … The proposed rule would limit the “collection, use, and retention of consumerpermissioned data to what is reasonably necessary to provide the consumer’s requested product or service.”2 We understand and support the principle behind this limitation—consumers should be in control of how their data is used and shared, not have it packaged and sold by data brokers in ways that are beyond their control and do not benefit them. However, the strict limitation on data use within a single product selected by the consumer could severely limit the benefits of those products to consumers, and it could hinder the development of healthy competition for the benefit of consumers.”
In the UK, a leader in the Open Banking sector, consumers hold absolute authority over who may and who may not access financial services data. A provider may not utilize the information without explicit consent of the user.
