CFPB Finalizes Personal Financial Data Rights Rule to Boost Competition, Protect Privacy, and Give Families More Choice

[Passages]

Rule will help lower prices on loans and empower people to more easily fire financial companies that provide bad service

OCT 22, 2024


WASHINGTON, D.C. – Today, the Consumer Financial Protection Bureau (CFPB) finalized a rule that will give consumers greater rights, privacy, and security over their personal financial data. The rule requires financial institutions, credit card issuers, and other financial providers to unlock an individual’s personal financial data and transfer it to another provider at the consumer’s request for free. Consumers will be able to more easily switch to providers with superior rates and services. By fueling competition and consumer choice, the rule will help lower prices on loans and improve customer service across payments, credit, and banking markets.

“Too many Americans are stuck in financial products with lousy rates and service,” said CFPB Director Rohit Chopra. “Today’s action will give people more power to get better rates and service on bank accounts, credit cards, and more.”

Today’s rule ensures consumers will be able to access and share data associated with bank accounts, credit cards, mobile wallets, payment apps, and other financial products. It aims to address market concentration that limits consumer choice over financial products and services. Consumers will be able to access, or authorize a third party to access, data such as transaction information, account balance information, information needed to initiate payments, upcoming bill information, and basic account verification information. Financial providers must make this information available without charging fees.

The rule moves the United States closer to having a competitive, safe, secure, and reliable “open banking” system. Today’s rule is part of the CFPB’s efforts to finally activate Section 1033 of the Consumer Financial Protection Act, a dormant legal authority enacted by Congress in 2010. This is the CFPB’s first significant rule to accelerate responsible open banking in the U.S., and the CFPB will be developing additional rules to address more products, services, and use cases. The rules will boost competition by giving people more freedom to switch banks or providers and shop around for the best deal. This increased choice will incentivize financial institutions to offer improved products that help them attract new customers and retain old customers.
https://www.consumerfinance.gov/about-us/newsroom/cfpb-finalizes-personal-financial-data-rights-rule-to-boost-competition-protect-privacy-and-give-families-more-choice-in-financial-services/