If data sharing is mandated beyond PSD2, then, instead of making data available free of charge for the recipient, it would be necessary to implement a model based on mutual benefits (similar to those applied in the telecommunications industry and in the United States) under which data access should be on commercial terms to ensure the maintenance of infrastructure and further investments in innovation.

According to the model above, financial organisations would be able to share data with other licensed financial services providers whenever requested, while being compensated for the technical costs of necessary infrastructure implementation. These costs would be reasonable and would guarantee non-discrimination of smaller providers. Without this compensation model, open finance initiatives would make it costly to hold large amounts of data, which is equivalent to having large amounts of clients. There would be discrimination against the largest providers of financial services.

In the areas of standardisation and interoperability, ESBG advocates for the establishment of a sufficiently flexible and broad framework of which the requirements would be limited to elements that are truly useful in the perspective of “productive” standardisation.

Identified Concerns

ESBG agrees with the principle of data sharing. However, in sectors where data is particularly sensitive, like the financial sector, data sharing should not be mandatory. Data sharing is a complex issue which needs to be balanced against several other factors, such as:

• ​​Defining a data taxonomy – Given the variety of data involved in the digital economy, it is essential to define a sectorial data taxonomy to make any data-sharing framework efficient and practical.
• Protect the trust asset – Customers must have absolute confidence about the security of their data. As trust is the most valuable asset that banks have to protect, security and cybersecurity should underpin a data-driven economy.
• Recognising the value of data – Processed data is a strategic and economic asset as well as a strong element of competitiveness for companies, that cannot be considered a public good, freely and automatically accessible to third parties, as they need financial, technical and human investments. The different stakeholders within the data sharing ecosystem need to have the right incentives to share their data.
• ​Customer data control – Customers should keep the control over their raw data, and decide which information they share, with whom, and for which purpose.
• Considering data rights – It is essential to consider the different rights that can protect data such as: intellectual property rights, banking secrecy, GDPR, competition law.​

Furthermore, the following three aspects would need to be carefully evaluated by the regulator concerning the application of GDPR:

• Which categories of data should the user have the right to access (e.g. Raw data, Inferred data, Observed data);
• Whether the supervisor allows for the use of such data and in which particular way;
  How the information required would be used.​

Upon the introduction of mandatory data sharing beyond PSD2, it needs to be recognised that implementing and maintaining data sharing mechanisms, processes and technical tools has a cost for those providing data sharing services. If institutions cannot provide infrastructure regarding commercial terms, it will not only have a negative effect on competition but also on quality and investments in terms of innovation.

As an advocate of technology neutrality, ESBG believes that the service and/or the product should always be regulated and not the technology. Though ESBG members have the possibility of accessing external data owned by BigTech companies, this usually comes at a high price. Some members have already encountered difficulties in using external data from other companies due to prohibitive prices. ESBG believes the financial sector does not need any further regulation in data sharing.

Background

Europe is undergoing a digital transition that is changing our societies and economies at an unprecedented speed. Data is at the core of this transformation. Through the consultation on a European data strategy, the European Commission aims at making the EU a global data space, a role model and a leader for a society empowered by data. The goal is to create a European single market for data where:

• Data can flow within the EU and across sectors, for the benefit of all;
• European rules, in particular privacy and data protection, as well as competition law, are fully respected;
• Rules for access and use of data are fair, practical and clear.​
• ESBG submitted a response to the consultation in May 2020, with additional comments.​