Open finance

European Commission’s Financial Data Access proposal: a step forward for consumers, but far more work to be done


Insurance Europe has welcomed the goal of the European Commission’s proposal for a framework on Financial Data Access (FIDA): to allow consumers to choose if, how, with whom and for how long they want to share their financial data. Nevertheless, the industry body has raised several concerns over the details of the package.

Ensuring a true level playing field is key to a sound data-sharing framework, so here Insurance Europe has welcomed the steps taken by the Commission. For example, the proposal — which includes elements on access to data related to pension rights and non-life insurance — would require data users to be subject to prior authorisation as a financial institution or financial information service provider to be eligible to access data and would require all providers to demonstrate a high-level of digital operational resilience.

The insurance industry also welcomes the draft regulation’s recognition of the need to ensure that there are sufficient economic incentives for data holders to provide high quality interfaces to make data available to data users. Furthermore, the proposals note that data holders should be able to request reasonable compensation from data users for putting in place application programming interfaces (APIs). Furthermore, facilitating data access against compensation would help achieve appropriate levels of investment and innovation, and ensure a fair distribution of the related costs between data holders and data users in the data value chain. It is also encouraging that the Commission recognises the importance of developing standards to facilitate data sharing, while at the same time providing for this to be industry-run.

Nevertheless, while the proposed framework aims to facilitate greater data sharing within the financial sector, the insurance industry is disappointed that it fails to embrace the clear added value of enabling cross-sectoral data sharing for financial institutions. Failure to make such provision is a missed opportunity that would have allowed consumers to directly benefit from a broad range of new and innovative data-driven products and services.

Insurance Europe also has concerns that the starting point of the proposed FIDA framework has such a wide scope. It would be better to start with a step-by-step approach, looking at specific uses to see where there could be a clear benefit for consumers in having a framework in place, as was previously done for payment services, and to identify the required data sets accordingly. More clarity would also be needed regarding the protection of proprietary data and enriched or inferred data that goes beyond mere raw data.

The insurance industry looks forward to continuing discussions on the Commission’s proposal to ensure that the proposed framework delivers for consumers and businesses.

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