MEPs want to enhance customers’ control over their financial data
European Parliament Members (MEPs) have put forth new regulations aimed at enhancing customer control over financial data within the European Union. The proposed harmonized framework seeks to provide individuals with the ability to securely manage their financial information, enabling them to optimize their financial services effectively. By granting explicit permission, customers can authorize the sharing of various data, including savings, investments, and insurance-related details, for the development of personalized financial products and services.
These regulations are particularly beneficial for small businesses, as they can leverage access to financial data to attract new customers, reduce operational costs, and foster increased competition and innovation within the financial sector. Customers will have full autonomy over how their data is utilized, with strict guidelines in place to ensure that data can only be shared with explicit consent and cannot be transferred to third parties without authorization. Additionally, customers retain the right to withdraw consent at any time, free of charge, emphasizing the importance of data privacy and security.
To uphold data protection standards, all personal data processing under these new rules must comply with existing EU legislation. Certain data categories, such as health-related information and confidential business data, are excluded from the scope of these regulations. MEPs have also specified that major digital platforms identified as Gatekeepers under the Digital Markets Act are ineligible to operate as financial information service providers, preventing potential circumvention of these rules through their dominant online presence.
MEPs have proposed the establishment of high-quality technical interfaces for data access, allowing data holders and users to utilize existing market standards such as application programming interfaces. Furthermore, provisions are in place for reasonable compensation for costs incurred by data holders in providing access. The European Banking Authority (EBA) is tasked with managing a register of authorized financial information service providers and overseeing the implementation of financial data access schemes. Small firms will be granted an additional 12 months to comply with these regulations, ensuring a proportional transition period towards full adaptation.
