Open banking to open finance: FCA looks to the future

Usage of open banking picked up pace in2020, while the regulator’s attention has turned to open finance – in which theprinciples of open banking are applied to a wider range of financial sectorsand products. A feedback statement from the Financial Conduct Authority setsout key findings and next steps, report Charlotte Hill and ArnavGupta.

CharlotteHillis a partner and head of the FinancialServices Regulatory group at Taylor Wessing in London, where Arnav Gupta is an associate. Contact them on c.hill@taylorwessing.com anda.gupta@taylorwessing.com.

Data and technology continue to drive change infinancial markets, in particular as a result of the Covid-19 pandemic. Firmsare bringing innovation to the forefront, developing new business models andproducts, as well as engaging with customers in new ways. In this regard, inits Business Plan for 2019/20, the FCA recognised open finance as a keypriority and specific cross-sector activity. [1] Open finance has the potentialto transform the way consumers and businesses use financial services. It aimsto allow consumers and businesses to access and share data with third partyproviders (TPPs) who can develop innovative products and services to meetconsumers’ current and future needs.