CFPB Proposes Data Rights Rule To Accelerate The Shift To "Open Banking"

On October 19, the Consumer Financial Protection Bureau (CFPB) issued its highly anticipated notice of proposed rulemaking to implement Section 1033 of the Dodd-Frank Act. The Personal Financial Data Rights Rule would require depository and non-depository entities, including providers of payment facilitation services, to make available to consumers and authorized third parties certain data relating to the consumers' accounts. The rule would also establish consumer protection obligations on these parties to access and use a consumer's data.

The Bureau Looks to Increase Competition for Banking Services

In an accompanying statement, CFPB Director Rohit Chopra stated that the proposed rule would accelerate a shift toward "open and decentralized banking" which can "supercharge competition, improve financial products and services, and discourage junk fees." The Bureau has emphasized that the rule would allow people to "break up with banks that provide bad service and