The CFPB is coming for your financial data rights.
“When a consumer permits their private data to be used by a company for a specific purpose, it is not a free pass for a firm to exploit the data for other uses, no matter what the legal mouse-print may say,” Rohit Chopra, the Consumer Financial Protection Bureau director, said at Money 20/20.
Some key takeaways:
- Financial institutions will be required to set up secure methods, like APIs, for data sharing.
- Incumbent institutions will be barred from improperly restricting access when consumers seek to control and share their data
- When consumers share their data for a specific use, that is the only use it will be used for.
- Alternatives to the so-called notice-and-opt out regime that has been the standard for financial data privacy
What’s next?
- October 2022: CFPB publicly releasing a discussion guide so small firms can weigh in regarding the proposals.
- Q4 2022: CFPB will convene a panel of small businesses that represent their markets to provide input on our proposals.
- Q1 2023: CFPB will publish a report about the input received through that process.
- 2023: Proposed rule issued
- 2024: Finalize rule and move to implementation
Read more about what Chopra said here