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The UK’s Financial Conduct Authority (FCA) is intensifying its examination of the competitive implications posed by Big Tech companies operating within the financial services sector.
The FCA’s heightened focus on Big Tech is outlined in a feedback statement stemming from its November call for input regarding data sharing between Big Tech entities and financial services providers. Presently, while Big Tech firms have access to financial services data through Open Banking, they are not obligated to reciprocate by sharing their data with the financial industry.
Nikhil Rathi, Chief Executive of the FCA, remarks, “The expanding presence of Big Tech in financial services has undoubtedly improved consumer convenience. However, the potential value of their data in financial markets remains uncertain. Hence, we aim to collaborate with Big Tech to assess how their data could best benefit financial firms and their clientele in the future, ensuring that competition evolves optimally.”
Should the FCA’s assessment conclude that Big Tech data holds significant value in financial services, it will seek to encourage greater data sharing between Big Tech and financial institutions through its ongoing efforts in Open Banking and the broader realm of Open Finance.
Conversely, if the analysis uncovers potential risks or harms stemming from the non-sharing of data, the FCA will endeavor to formulate recommendations for the Competition and Markets Authority (CMA). These recommendations will serve as guidance for the CMA as it assumes regulatory oversight of designated firms’ digital and data practices, a responsibility anticipated through the Digital Markets, Competition, and Consumers (DMCC) Bill.
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