In December of 2019, the FCA published a Call for Input, to “explore the opportunities and risks arising from open finance”, and have now published a Feedback Statement to summarize the responses they received. Some of the feedback highlighted that:
- Open finance could be a significant undertaking for firms. This is particularly important given the change in operating environment as a result of Covid-19 and its ongoing impact.
- The implementation of open finance should be proportionate, phased and driven by consideration of how consumers will use and interact with it.
- There is 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 feedback also showed that “open finance could potentially offer significant benefits to consumers, including increased competition, improved advice and improved access to a wider and more innovative range of financial products and services." It could, however, also generate or increase existing risks, therefore fostering questions surrounding data ethics which will require additional regulation to manage risk and boost consumer confidence.
More information on the FCA’s Call for Input on open finance can be found here.