Financial institutions produce a large amount of data, particularly due to the growing adoption of digital payments. These data can be used to build more accurate prediction models and perform more precise calculations. The data is personal and contains information about the individual. Because of this, laws and regulations, such as the GDPR in Europe or the California Consumer Privacy Act (US) limit the sharing of customer information by financial institutions.
Sharing financial information is important for a wide range of reasons, including better fraud prediction and faster application processes. You can also avail more services and products, such as credit cards and loans by sharing your financial data. If you decide to grant access to your financial information it is essential that you do it with an established partner. Trustworthy companies, apps and financial service providers should be able to clearly define the reasons behind sharing data and the specific partners they’ll cooperate with in sharing your data.
The key to unlocking the potential of financial data aggregation lies in creating an open and unifying data ecosystem that enables different users to carry out distinctly different tasks without putting themselves at risk. The ability to securely access and process data in real time is crucial and requires a clear understanding of each user’s role. To accomplish this goal, effective control of data access is essential to maintain the right balance between security and utility. The focus should be on allowing live financial information to move between businesses or departments while protecting customer rights.