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February 05, 2021

Plaid's comments to the CFPB on Dodd-Frank 1033

Ben White & Katie Neal

Last October, we wrote “A call to action for fintech,” to highlight the Consumer Financial Protection Bureau’s (CFPB) opportunity to set the stage for the future of financial services by empowering consumers with stronger data rights. 

Since then, Plaid has worked with our stakeholders - fintech companies, financial institutions, and, above all, consumers - to build our case for the CFPB to take action to ensure consumers can control their data in order to benefit from fintech. These efforts ultimately led to our submitting a comment letter in response to the CFPB's Advanced Notice of Proposed Rulemaking on Consumer Access to Financial Records, which addressed Section 1033 of the Dodd-Frank Wall Street Reform and Consumer Protection Act.  

In our 50+ page comment letter, Plaid laid out our view of the current market, and our vision of the future of consumer control of their data. We also brought together a group of fintech companies to submit a coalition letter.  

Here’s what Plaid asked the CFPB to consider in its rulemaking:

  • Enforce consumer rights to authorized data access: Consumers rely on their ability to authorize third parties’ access to their financial information in order to power fintech products and services that help them improve their lives. To ensure that all consumers enjoy consistent authorized access to their financial information, the Bureau should establish rules enforcing broad Section 1033 rights.

  • Supervise data aggregators: Data aggregators play a critical role in the authorized data ecosystem by acting as consumers’ agents and carrying out consumer desires to share data. Many data aggregators, including Plaid, have reached a size at which supervision would provide helpful oversight and assurances to the financial data ecosystem.

  • Don’t mandate technologies: Collaborative, industry-led standards-setting is underway. The Bureau should establish principles-based guidelines for these standards to meet, so that standards can satisfy consumer expectations and evolve with technological innovation. 

  • Monitor practices to ensure competitive incentives do not impact consumer access: Competitive incentives in the authorized access ecosystem will grow as data holders become data users and vice versa. The Bureau should prevent data holders from restricting consumer data access to further their competitive interests.

  • Assess ecosystem readiness: To ensure that consumers at all data holders have equal access to the fintech ecosystem, the Bureau should regularly assess the availability and consistency of authorized access.  

Each of these recommendations rolls up into our broader view of what the future of financial services looks like: consumers at the center, free to take their data with them to any provider that meets their needs. 

We believe that this framework would enable the CFPB to ensure that consumers have all the protections they need, and that innovators can continue to build on the promise of fintech.

Ben White and Katie Neal are on Plaid's Policy team, they advocate for a world in which financial freedom is possible for everyone.