The UK government’s legislative agenda for the next parliamentary year looks very promising for the Open Banking and Open Finance industry.
The Queen’s Speech, the official record of the government’s priorities for the months ahead, which was delivered by Prince Charles yesterday, 10 May, made reference to a Data Reform Bill that will foster a “world-class data rights regime” to help “create a new pro-growth and trusted UK data protection framework that reduces burdens on businesses, boosts the economy, helps scientists to innovate and improves the lives of people in the UK”.
The Bill was warmly welcomed by the industry.
Charlotte Crosswell, chair and trustee of the Open Banking Implementation Entity (OBIE), said: “The inclusion of Smart Data legislation in the Queen’s Speech brings us one step closer to expanding the benefits of Open Banking to other sectors of the economy, including energy, telecommunications, and pensions. It will put consumers and small businesses in control of their data and drive much needed innovation and competition.
“Consumers and SMEs are benefiting from the UK’s mandatory approach, with over 5.5 million active users, and over half of SMEs using Open Banking today. The government and regulators’ commitment to the continued momentum and growth of Open Banking, together with Smart Data, demonstrates their commitment to using data for the good of our people and businesses.
Smart Data strategy
Paul Scully MP, Minister for Small Business, Consumers & Labour Markets and Minister for London Department for Business, Energy and Industrial Strategy, addressed the delegates of the Open Banking Expo UK 2021. As part of his keynote address, he said that the government was looking to work with the industry on data strategy.
“We see better use of data as a way to solve problems to consumers or business and society and as a way, which is in particular priority of my department to drive innovation and growth,” Scully said.
“The onus remains on the customer to make sense of the actual data. How easy do you find it to compare and switch utilities tariffs, or work out the financial and carbon impacts of your spending and investments? Too many customers are paying too much or looking for service,” he continued.
Crosswell said: “Smart Data will allow the government and regulators to mandate similar participation in other sectors, and will deliver real cross-sector benefits by creating an interoperable framework for data sharing. Data can unlock a whole suite of benefits for consumers and small businesses and can be mobilised to combat the increase in cost of living through better access to credit, increased competition between incumbents and supporting new market entrants, and better management of household and company bills. We will continue forward to working with the government, policymakers and regulators to deliver benefits for consumers and SMEs across the UK.”
The Bill is also designed to create a data protection framework that is focused on privacy outcomes rather than box-ticking; modernise the Information Commissioner’s Office, making sure it has the capabilities and powers to take stronger action against organisations that breach data rules; as well as to increase industry participation in Smart Data Schemes that will give citizens and small businesses more control of their data.
Rich legislative agenda
The Queen’s Speech also included two more bills that are of importance for the industry: the Financial Services and Markets Bill and Economic Crime and Corporate Transparency Bill.
UK Finance, the industry body representing around 300 firms across financial services, said: “We strongly welcome the announcement in the Queen’s Speech that the government will bring forward a Financial Services [and Markets] Bill and a further Economic Crime [and Corporate Transparency] Bill, which we see as two key pieces of legislation for financial services.
“The Financial Service Bill provides the opportunity to tailor the UK’s regulatory framework and so create a more competitive financial services sector post-Brexit, supporting jobs and investment across the country.
“The Economic Crime Bill will be critical in helping to address money laundering and the growth in fraud and scams, which are now the most prevalent type of crime in the UK. This Bill should focus on measures that prevent fraud happening in the first place and provide greater enforcement powers to tackle those who commit economic crime.”
Watch Paul Scully’s Open Banking Expo UK 2021 keynote address titled “A future vision for the role of Smart Data” in full here.