Ketharaman Swaminathan - GTM360 Marketing Solutions - Pune 03 October, 2017, 14:41 0 likes

LOL. Fintechs say technology evolves too fast for banks to keep pace. Now banks say banking evolves too fast for regulators to keep pace. I'm waiting for the regulator to close the loop by saying regulation evolves too fast for fintechs to keep pace! But it's all a moot point. Innovative Fintechs Don’t Need No PSD2 Regulation

Dinesh Katyal - Financial Data Exchange - San Francisco Bay Area 03 October, 2017, 14:49 0 likes

The irony is that open banking makes sense precisely because of these concerns. Consumer need to have permissioned access to data in non-bank applications is critical for a variety of personal and business financial tasks. Open Banking in UK is facilitating that while creating safeguards that result in secure, sanctioned means. As for the banks investing in fintechs, a number of banks have already struck partnerships in that space in other countries so unclear what the barriers are in Canada. 

Brian Costello - Envestnet | Yodlee - San Francisco Bay Area 03 October, 2017, 22:49 2 likes

I found the full report more balanced than the summary, and appreciate the CBA weighing in on these topics.  I am hopeful they will follow-up with sincere engagement on these topics.

The CBA is correct that risks to the consumers, FIs and the market must be considered and managed well in whatever ecosystem evolves for consumer-permissioned finanical services in Canada.

There was a qualifying statement in the report that spoke volumes to me:  "...there is a need to gauge consumer demand for third party access which may also vary across jurisdictions."  It's not demand that is the primary the driver; it is need.  Consumers need help to become finanically healthy.  They need help funding their retirement.  They need help optimizing a fixed income.  Let us focus on that to inspire us to work together to address the inherent risks.

Simon Howard - Talking tech - London 04 October, 2017, 10:51 0 likes

There are fears we are seeing regarding open banking that consumers will not consent to share their data as they are unsure how their data will be used. The key for consumers to embrace the principles of open banking is the value proposition.  "Whats in it for me?" If for example it allows a consumer to complete a mortgage application faster or an Income and expenditure form for debt assessment then I can see a fairly good acceptance rate.  The issue we have seen and this was confirmed at a recent workshop in London we conducted is that although there are roughly 2 million people using screen scraping solutions the average consumer is unaware of open banking and like all things unknown there will be an air of suspicion. For 3 years I have been building I&E solutions that will help a consumer complete an accurate financial statement that will offer them a sustainable and affordable repayment plan to cure their debt position and make them more financial capable. Our latest research indicates that now we have a robust single format for I&E and a digital self-cure platform which a consumer can use what is now being demanded by both consumers and banks is the pre-population of the form using the current account data. Later this year we are conducting tests with our major banking clients to see how many consumers will consent to open banking as part of an income and expenditure assessment process the results of which we will publish. In early Nov I will be at the SCORE conference in Toronto, Canada discussing this topic along with other uses of digital technology and case studies. http://www.scorestat.com/2017-score-dormant-debt-conference/

Ketharaman Swaminathan - GTM360 Marketing Solutions - Pune 04 October, 2017, 15:46 0 likes

During the last 10 years or so, a few million people have handed over their Internet Banking credentials to MINT et al. So, even without the official approval of PSD2 / Open Banking, PFMs and MoMMAs have had full scraping access to customers' bank accounts for a long time. What have they done with it so far? Have they radically changed the financial health of these people? or helped them fund their retirement? or helped them optimize their fixed income? If they can demonstrate that they have, tens of millions of customers will queue up to hand over their banking creds to them - even without PSD2 / Open Banking regs.

A Finextra member 05 October, 2017, 08:56 0 likes

All the talk about open banking is fine. From a worst case scenario perspective, if there is a data breach who is accountable? and to what measure. Regulations governing banks are solid and time tested, on the other hand fintechs ar,e in principle technology companies. Given this, will OSFI come out with regulations for fintechs?

Brian Costello - Envestnet | Yodlee - San Francisco Bay Area 05 October, 2017, 15:46 0 likes

Loving the discussion...

Yes, financial wellness for thousands of consumers have been improved by consumer-permissioned data driven solutions.  The members of the Consumer Financial Data Rights group (http://consumerfinancialdatarights.org/) in the US and of FDATA  (fdata.co.uk) in the UK are just some of the companies doing this good work responsibily and safely.

The regulations exist today for responsible and compliant engagement with consumers and their financial data.  We need regulators to help clarify how they are applied, harmonize them and right-size enforcement.  We also need clearer guidelines around competition and UDAAP.  The Canadian Competition Bureau has some good thought leadership on that topic.

Carlos Figueredo - Open Vector Limited - London 06 October, 2017, 09:35 0 likes

The full CBA report is more balanced in terms of outlining both the benefits and risks that open banking presents. Data, "the new oil", will continue to be mined for competitive advantage.

How and when Canada's government, regulators and authorities choose to realign policy framework and strategy to (re)align and enable the benefits that open banking can yield is a choice.

Canada has an opportunity to consider its position and leverage the opportunities that open banking can afford within this evolving global financial ecosystem. 

Will Canada claim this opportunity in time or allow others to supersede?

Ketharaman Swaminathan - GTM360 Marketing Solutions - Pune 06 October, 2017, 10:09 0 likes

Let's examine this statement carefully: "financial wellness for thousands of consumers have been improved by consumer-permissioned data driven solutions."

Given that MINT et al boast of millions, if not tens of millions, of users, "thousands of consumers" is 0.1% of the user base. IMO, any technology that delivers its promised benefits to only 0.1% of its user base is closer to snake-oil than innovation. Taking financial decisions by using the toss of a coin would've benefited a far higher percentage of the user base.

It's simply not worth handing over the keys to the kingdom - aka Online Banking  credentials - to something that delivers benefits to such a tiny fraction of its user base.

Brian Costello - Envestnet | Yodlee - San Francisco Bay Area 06 October, 2017, 16:13 0 likes

Ketharaman, my use of "thousands" was to avoid a grandious claim unsupported by empirical data.  If we're looking at number of customers as the metric, then it certainly is millions of consumers have benefited from finanical wellness solutions, affordabillity assessments by responsible lenders and appropriate fiduiary advice.

However, the future of "open banking" is not credential-based, it's identity and consent based.  Let us all ask our banks to immediately render our current usernames and passwords "read only" and deploy step-up authentication for inherently risk activities such as paying a bill or adding a payee.  Then let's build a user-centric identity framework upon which finanical, health and governmental data services may be safely deployed.

Until then, let's evolve the fragmented ecosystem of commerically-managed financial data aggregation to a more holistic one; ie. "open banking".

Ketharaman Swaminathan - GTM360 Marketing Solutions - Pune 06 October, 2017, 17:27 0 likes

Oh c'mon @BrianCostello, you want banks to add more friction to Internet Banking just so that fintechs can get read-only access? This "open banking" thing is sounding even more delusional than I thought.

I also love the way the number of customers who have benefited from PFM / MoMMA has suddenly jumped from "thousands" to "millions". But let me play along for the moment: In the IT industry, of which fintech is a part, it's a standard practice to provide testimonials from customers. Where are these testimonials in the case of PFM/ MoMMA? I had a quick glance at the CFDRG and DNATA websites you linked to and couldn't find any testimonial. They say they want to help customers but don't provide any evidence of already having done so.