Alasdair Smith, an inquiry chair at the Competition and Markets Authority (CMA), said without “the right safeguards” banking customers will not give their consent for their data to be “shared with anybody”.
At the conclusion of its retail banking market review, the CMA said UK banks would be required to implement an open banking standard by early 2018, to allow businesses and consumers to share their own current account data with other banks and third parties and manage multiple providers through a single app.
Open banking will be built on linking different systems together via application program interfaces (APIs). In a recent speech, Smith said the use of open APIs in banking would “give customers control over what data is shared and with whom”.
The CMA has recently published details of the initial work (2-page / 214KB PDF) being undertaken towards the development of the open banking standard. It includes work to set up an ‘implementation entity’, containing representatives from industry, to “act as the forum for the discussion and agreement of the application program interface (API), data and security standards”.
“To ensure that enough time is available to work through the important details of this remedy, particularly those that ensure that customers’ data is secure at all times, we are requiring that the release of information under this remedy takes place in stages,” Smith said.