CMA to create a regulatory body to oversee the open banking industry

The UK competition regulator has proposed the establishment of a new entity to provide “regulatory oversight” of the open banking industry.

The Competition and Markets Authority (CMA) said on Friday that the remaining designated regulatory entity will replace the Open Banking Enforcement Unit (OBIE).

In joint statement In conjunction with the EM Fund, the Financial Conduct Authority and the Payment Systems Regulator, the MMF outlined the establishment of a Joint Regulatory Oversight Committee (JROC).

The CMA’s recommendation is that the future entity be jointly led by the FCA and PSR, with independent and accountable leadership. The majority of the board should consist of independent directors, which has been added to the statement.

“Open Banking in the UK has been a resounding success, bringing new innovative services to retail banking and benefiting UK consumers, businesses and the economy,” said CMA chief executive Andrea Coscelli.

“The MMF has carefully considered the appropriate future arrangements for boosting open banking so that its significant benefits can be realized even more widely. Today we have outlined the key principles that will ensure that the new entity achieves the return. ”

Open banking was launched in the UK in 2018 and enhances interoperability between banking services by opening up data to third-party developers using APIs.

The MMF, in its report recommending the implementation of open banking, found that it allowed more competition in banking and helped support the British fintech boom.

The latest announcement comes after a group of fintechs from the UK criticized the CMA over the uncertainty of the future of open banking.

“We can’t focus now,” said Nanna Saito Nielsen, vice president of banking operations at GoCardless. RATN in response to the statement.

“While it is true that we have built the foundations of open banking, there are still fundamental issues that need to be addressed to enable mass adoption, such as improving API uptime and creating a payer experience that, least, good and consistent across. banks. ”

Saito added that there was still a funding issue to be resolved: “While we are encouraged to see a broader funding model, we have not yet seen the details.”

Emma Burrow, head of the fintech development office at Stripe, told RATN: “The UK has an unfinished business with Open Banking. The decision to move early and boldly on open banking rules is to be commended, and there is now a need for a continued regulatory focus and a business model that works for all players to reach their full potential. ”

In January, the number of banking users opened in the UK the passing of the five million milestone.

“Coordination between the MMF and the OBIE is critical to the further evolution and standardization of open banking within the UK,” said Damien Cahill, co – founder and COO of fintech Vyne. “It will empower users, give them more control over their data and provide a rich market with competition and innovation to better meet their banking and payment needs.”

CMA to create a regulatory body to oversee the open banking industry

Source link CMA to create a regulatory body to oversee the open banking industry

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