WASHINGTON, D.C. – The U.S. Consumer Financial Protection Bureau’s (CFPB) proposed Personal Financial Data Rights Rule would promote competition and safeguard consumer data privacy and security in the financial services sector, 18 groups said today in a letter to the agency. If finalized, the rule will lead to better prices and services for consumers.
“We applaud the CFPB’s initiative to jumpstart competition in the banking and consumer finance sectors, and we believe that this rule will address the ongoing imbalance between financial service providers and consumers,” the groups wrote. “It promises to strengthen and improve the industry – allowing individuals to find affordable credit cards, loans, and savings accounts while enjoying improved customer service.”
Market concentration in the financial industry has reduced options for consumers and disincentivized financial service providers from improving their offerings. The challenge of transitioning between providers deters many consumers from seeking better alternatives, raising concerns about a lack of competition, undesirable fees, and barriers to more favorable rates.
The proposed Personal Financial Data Rights rule seeks to break down these barriers by offering consumers greater agency in their financial choices and enabling smaller community banks and emerging competitors to vie for customers based on superior products and services at competitive rates.
Polling indicates Americans’ strong support for data portability and for the CFPB’s role in helping make it possible for consumers to switch banks.