The head of the UK’s financial regulator has said it plans to examine how big tech firms’ access to large amounts of data could unlock better financial products and more choice for consumers.
Financial Conduct Authority (FCA) chief executive Nikhil Rathi said the watchdog wanted to look into how data collected by tech firms could be helpful to consumers and finance firms.
In a speech at an event held by the Digital Regulation Cooperation Forum (DRCF) – a coalition of several major UK regulators, Mr Rathi said that if the FCA’s analysis found that tech firms’ data could be useful in financial services, it would look to incentivise more data sharing between tech and financial firms through systems such as Open Banking.
The FCA chief executive said that if it found any potential risk or harms from the non-sharing of data, it would also look to work with the Competition and Markets Authority (CMA) to develop proposals around digital and data conduct to boost data sharing where possible.
“Big Tech’s growing emergence in financial services has already made life easier for consumers, but it is still unclear how valuable their data will become in financial markets,” he said.
“That’s why we want to work with Big Tech to examine how their data could be most helpful for financial firms and their customers in future, and to ensure competition evolves effectively.”
He added that it was important to prevent a handful of technology companies from cementing a powerful position within the sector, an issue regulators around the world and across different industries are currently responding to.
“With Big Tech now an essential component of the financial services supply chain, there is also the risk that the combination of cloud, data and AI will cement Big Tech’s power in partnerships with firms across financial services and other sectors,” Mr Rathi said.
“We need more industry players to feel they have a part to play on the data pitch. Safe data sharing can benefit firms, markets and consumers. It is crucial for Open Banking and Open Finance.”