If you depend on an app or website to help you manage your finances by putting all your financial information in one place, you got some good news Wednesday.
The Consumer Financial Protection Bureau is looking to make sure banks keep the data flowing into those tools.
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In recent years, some banks have been moving to slow the flow of customer information to personal finance apps like Mint, citing concerns about how those companies secure that data and their accountholders’ login information.
(The fact that banks would rather see their customers use their own tools to track their finances, rather than some third party’s tools, might also have something to do with it.)
At different times, Bank of America, Wells Fargo and Chase have cut off or slowed the flow of information to third party companies.
But the Dodd-Frank Financial Reform Act specifically requires them to share customer information, with some exceptions to protect intellectual property, and gives the CFPB authority to make rules to help make that happen.
Now the CFPB is launching an inquiry on the issue, looking into three big issues:
- How much choice consumers are given about how their financial records are used.
- How secure it is for consumers to share their financial records with third parties.
- How third parties can use that information once they have it.
“Consumers should be able to use their financial records and account information and securely share access in an electronic format,” said CFPB Director Richard Cordray in a press release. “Technology provides opportunities to use these records to create new consumer tools that help improve financial lives. To realize that potential, we are launching a public inquiry into how much control consumers have over their records and how easy and secure it is for them to share their records with third parties.”
You can read the formal request for information here.
A measured approach
In its press release, and in prepared remarks to be given by CFPB Direct Richard Cordray in Salt Lake City, the agency struck a conciliatory tone regarding the banking industry’s security concerns, and the way forward for banks, financial technology companies who want the data, and consumers.
“We are confident that financial institutions and other companies can develop technological solutions to maintain and transfer these records safely and securely,” Cordray said. “And we believe we can achieve transparency in the use and distribution of financial account records by consumers who can control how to initiate, manage, and terminate access to their information.”
So far, this is just an inquiry, and it’s not clear whether it will result in a new rule placing new restrictions or requirements on banks or fintech companies.
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Office of the Executive Secretary
Consumer Financial Protection Bureau
1700 G Street NW., Washington, D.C., 20552.
The docket number is CFPB-2016-0048.