Media Contacts
Director, Consumer Campaign, PIRG
New rule gives consumers more control over transaction data, promotes competition
WASHINGTON — The Consumer Financial Protection Bureau (CFPB) finalized its Personal Financial Data Rights Rule on Tuesday, facilitating the shift toward “open banking.” The rule requires that financial companies allow customers to share or transfer data from their transaction accounts, including checking accounts, prepaid cards, credit cards and digital wallets.
The rule, which implements section 1033 of the Consumer Financial Protection Act of 2010, also requires compliance with Federal Trade Commission (FTC) data protection laws and prohibits the use of data other than to deliver the product the consumer requested. For example, data couldn’t be sold or used for targeted ads unless authorized separately.
The CFPB had finalized part of the rule in June, establishing criteria for becoming a recognized data-sharing, standard-setting body, to help companies comply with the new regulations.
In response, U.S. PIRG’s Consumer Campaign Director Mike Litt released the following statement:
“The promise of open banking is one step closer to being realized. This rule gives consumers greater control over their own data. It will be easier for consumers who feel stuck with their bank to make a switch by allowing them to transfer transaction histories to new institutions.
“Enabling secure transfer or sharing of financial data will incentivize financial companies to compete for customers by providing better interest rates and customer service.
“Moreover, access to transaction histories could lead to more personalized offers that consumers might not have qualified for otherwise.”
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