FCA updates on open banking progress
The Financial Conduct Authority (FCA) and other members of the joint regulatory oversight committee have outlined the ways in which they plan to expand and promote open banking in the year ahead.
The regulators confirmed that open banking will soon transition from the current model – where it is overseen by the Open Banking Implementation Entity (OBIE) – to an interim regulatory state, before a future entity is created to take the place of the OBIE.
“The committee is determined to ensure that the benefits of open banking are fully realised and momentum is sustained,” said the joint committee in a statement.
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“Open banking has a continuing role in promoting greater competition and innovation for the benefit of consumers, businesses and the wider economy, as well as maintaining the UK’s international competitiveness and leadership in the field. This will enable new services that consumers and businesses value and trust, and which support sustainable economic growth.”
The committee plans to use open banking payments to support competition and innovation, and to create a model that is scalable for future data-sharing propositions.
In January 2023, a new report is expected from the Strategic Working Group, which is independently chaired by Bryan Zhang. This report is expected to lay out some of the key actions that are required for the expansion and support of open banking. The committee said that this report will “be a critical input” to its future plans.
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“Open banking and its future continue to be a priority for the FCA and the PSR,” said the co-chairs of the committee, the FCA’s executive director, consumers and competition, Sheldon Mills; and the payment systems regulator’s (PSR’s) managing director Chris Hemsley.
“Together with the committee and industry, we are committed to its continued growth and evolution. Fully realised, open banking and then open finance can bring further benefits to consumers and businesses and will help the UK become more competitive and innovative.
“This means supporting new use cases, promoting innovation and competition in data sharing and payments, and setting the vision for future developments. We will, with the other members of the committee, work closely with industry and broader stakeholders to establish a future entity that will deliver these outcomes.”
The joint regulatory oversight committee was established in March 2022 to create a roadmap for the future of open banking in the UK. It is co-chaired by the FCA and the PSR, with HM Treasury and the Competition and Markets Authority (CMA) as members.
The next update will be released within the first quarter of 2023.
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