Financial Data Access (FIDA)

The Road to Open Finance

As of June 2023, the European Commission's Digital Finance Strategy has taken a significant step forward. The Financial Data Access (FIDA) legislation, a key component of this strategy, was announced with the goal of transforming the way financial data is accessed across the industry upon consent of the customer. The essence of this upcoming regulation is that it enforces Financial Institutions to share customer data on financial products (such as loans, mortgages, savings, investments, insurance and pension products) with third parties who want to use this data in their services. These third parties can be other Financial Institutions or Financial Information Service Providers (FISPs) who need to obtain a license. The financial data can only be shared when the customer, as the data owner, gives its consent to do so. The scope of FIDA includes financial data about consumers but also small and medium sized enterprises. This initiative builds on the progress made by Payment Service Directive 2 (PSD2), which catalysed the Open Banking movement, and is further reinforced by PSD3 and the Payment Service Regulation (PSR), strengthening the framework. FIDA is set to expedite the shift towards Open Finance, facilitating increased sharing of financial data beyond payment information.

The European Commission has identified key areas where data sharing in financial services can be significantly enhanced:

Strengthening customer trust: Empower customers by giving them full control of their financial data in a secure and meaningful way.
Mandatory data exchange between data users and data holders: Create equal opportunities between direct competitors, downstream providers in the same sector, SMEs and start-ups.
Standardisation of customer data and interfaces: Improve data quality shared between data users and data holders
Implementation of high-quality interfaces for data users: Assurance that data holders are complying with regulatory requirements to the highest possible degree.

This pivotal regulation marks a cornerstone in the EU's strategy towards Open Finance, aiming to foster innovation and digital transformation within the financial services sector. PwC can help offer initial guidance through the complexities of compliance with this new regulation. The challenge of becoming compliant is that there will be a significant impact on the processes, data, technology, consent management, and customer journey of financial institutions.

There will be strategic impact as well, as it creates threats and opportunities in the market. PwC can help your organisation leverage the potential of Open Finance to drive business growth and innovation through the new possibilities that FIDA offers.

How PwC can help

With the regulation likely to come into effect by 2027, PwC can help with a high-level gap analysis highlighting discrepancies and outline necessary actions for FIDA compliance. We have a team of experienced specialists in Business, Data, Technology, Product, Operations and Regulatory Compliance. With our combined knowledge, experience and international network we can help you guide with each step in the preparation for FIDA. While ensuring compliance readiness, PwC can also help with unlocking new business potentials and the creation of innovative financial products & services to gain a competitive advantage.