CFPB issues data privacy rule expected to spur move toward ‘open banking’ framework

The Consumer Financial Protection Bureau (CFPB) issued a final rule implementing Section 1033 of the Dodd-Frank Act designed to give consumers greater control over their personal financial data. A key component of the rule is the requirement data providers develop and maintain secure online interfaces where consumers can access and share their data free of charge.

The CFPB and many industry insiders have stated this rule will move the U.S. financial sector closer to establishing a safe and competitive “open banking” system that will incentivize financial institutions to improve their product offerings to attract new customers and retain existing ones.