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Open Finance should lead to tailored advice and increased competition – FCA
Allowing consumers to easily access their financial history and products through Open Finance should result in increased competition and “individually tailored advice”, the regulator has said.
In a speech at The Investments and Savings Alliance (TISA) Open Finance Conference in London on 18 November, Sheldon Mills, director of competition at the Financial Conduct Authority (FCA), said having access to the data provided with Open Finance would put consumers in control meaning advice should be given to help them manage financial responsibilities.
Mills added that previously excluded customers would feel “empowered” to interact with other financial services sectors and said the regulator wanted to approach the technology in a way that “unlocks consumer benefits and balances the potential risks”.
With this he said, “full responsibility and, potentially, control” would rest with the consumer and added as they became more responsible for their own financial decisions, advice would become “especially important”.
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Encouraging competition
Due to more people engaging with financial services, Mills said the FCA would figure out where it needed to “foster an environment of healthy competition” which encouraged innovation and had the right amount of customer protection as it was “extremely important” to the regulator.
He added: “We want Open Finance to develop in a way which works in the interests of consumers, which mean that Open Banking can and should be part of the Open Finance journey.”