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Canadians Would Warm to Open Banking with Assurance of Increased Security and Greater Awareness of Benefits, Accenture Survey Suggests

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Open banking technology is poised to change the way the world completes transactions, but three quarters (75 per cent) of Canadians say they are wary of the concept, citing concerns about the privacy of their financial data, according to a new survey commissioned by Accenture (NYSE: ACN).

The online survey asked more than 1,500 Canadians how they feel about the concept of open banking, which allows for the secure sharing of financial information — such as account balances, transactions and payment information — with registered third-party providers such as authorized retailers, social media platforms and fintech companies. The sharing of this information enables registered parties to provide consumers with better services, such as access to credit and personal financial insights.

Among respondents’ top concerns with open banking: the security and privacy of financial data (cited by 62 per cent of respondents); trusting large tech companies with their financial information (51 per cent), and believing that open banking will deliver enough value to drive a change in their current behaviour (44 per cent).

However, the survey also revealed that Canadians could warm up to the idea of open banking if certain measures were taken to address their concerns, including: additional access procedures such as an authentication password and security questions (cited by 34 per cent of respondents); biometric technology such as fingerprint or facial recognition (33 per cent); and real-time analysis of their payments to ensure that they conform to regular patterns (32 per cent).

One-in-five respondents (21 per cent) also said they would be willing to share banking account data with registered non-banking third parties in return for a better deal or other benefits. This is an interesting finding, as use cases in other countries have demonstrated that open banking could help create products and services that are tailored to customer spending patterns and lifestyle choices, in addition to creating a far greater range of options for reward and loyalty programs.

“Open banking is poised to transform banking operations worldwide but remains a relatively new concept to many Canadians,” said Bob Vokes, who leads Accenture’s Financial Services practice in Canada. “A critical element to open banking’s adoption is the right regulatory framework to ensure that consumers can decide which parties safely receive access to their financial information on a case-by-case basis — but to do that they’ll need to be convinced of the benefits. For example, by providing a lender with a holistic view of a borrower’s financial position, open banking could lead to faster approval rates, a higher loan amount or even a better interest rate.”

The survey also found that many Canadians (40 per cent) don’t understand the benefits of open banking enough to provide third-parties with access to their financial information, suggesting that public education could have a significant impact on consumers’ perception and adoption of open banking. In fact, one-in-five respondents (20 per cent) said they would want to know more about consumer protection from potential fraud before deciding on whether they would be interested in this concept.

“As we assess the impact of digital transformation in the financial space, open banking knocks down silos and makes transactions much more efficient,” said Andrew McFarlane, Accenture’s global head of open banking. “The technology is beneficial to both consumers and businesses because it enables smarter and faster decision-making. The gap in knowledge about open banking and its benefits presents an opportunity for stakeholders to educate and shift perception so Canada can keep up with the way the world is banking.”

Among other key survey findings:

  • One in six respondents (17 per cent) said it would be beneficial to see all financial information in one place, and slightly fewer (14 per cent) like that they could be provided tailored offers like a better mortgage rate or higher savings interest rate.
  • Approximately one in seven respondents (14 per cent) would consider accessing their bank account information directly from an online retailer to view their balance and make a payment without leaving the website or sharing any account details in preference of a credit card or debit card.
  • Regionally, Quebecers are slightly more likely to be interested in open banking than are other Canadians (21 per cent versus 16 per cent, respectively).

 

SOURCE Accenture

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Expressions of Interest for Director of the European Bank for Reconstruction and Development

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The Minister for Finance, Michael McGrath, is inviting Expressions of Interest from suitably qualified candidates to be considered as Ireland’s Director of the London-based European Bank for Reconstruction and Development (EBRD). The remunerated position of Director is an important post with a demanding workload. A full-time residential position, it is based at Bank headquarters in London.

The Minister’s nominee is expected to be appointed by the EBRD, with the agreement of Ireland’s Constituency partner countries, for a three-year term from 1 August 2024.

Minister McGrath commented:

“This is an exciting opportunity to represent Ireland (and our Constituency partners Denmark, Lithuania and Kosovo) as a Director on the Board of the European Bank for Reconstruction and Development overseeing the policy-making and governance of the Bank. The EBRD is a unique International Financial Institution supporting projects across three continents. By investing in projects which otherwise would not be fully met by the market, the EBRD promotes entrepreneurship and fosters transition towards open and sustainable market economies. I am keen to ensure our Irish representative has the ability, education, vision, and experience to make a significant contribution to the Board and brings a range of skills and diverse perspective to the deliberations of the Board.

My nominee will need high competence in economic and financial matters. Expertise can come from notable or significant achievements in the corporate or financial sector, academia, policy-focused institutions, or public service. Importantly, they will have the highest ethical standards, a strong sense of professionalism and commitment, and dedication to serving the interests of all the shareholders and be able to make themself readily available to the Board in the fulfilment of their duties.”

Expressions of interest will be accepted up to 3pm on 27th March 2024

The post Expressions of Interest for Director of the European Bank for Reconstruction and Development appeared first on HIPTHER Alerts.

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Council adopts regulation on instant payments

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The Council adopted today a regulation that will make instant payments fully available in euro to consumers and businesses in the EU and in EEA countries.

The new rules will improve the strategic autonomy of the European economic and financial sector as they will help reduce any excessive reliance on third-country financial institutions and infrastructures. Improving the possibilities to mobilize cash-flows will bring benefits for citizens and companies and allow for innovative added value services.

The instant payments regulation will allow people to transfer money within ten seconds at any time of the day, including outside business hours, not only within the same country but also to another EU member state. The regulation takes into consideration particularities of non-euro area entities.

Payment service providers such as banks, which provide standard credit transfers in euro, will be required to offer the service of sending and receiving instant payments in euro. The charges that apply (if any) must not be higher than the charges that apply for standard credit transfers.

The new rules will come into force after a transition period that will be faster in the euro area and longer in the non-euro area, that needs more time to adjust.

The regulation grants access for payment and e-money institutions (PIEMIs) to payment systems, by changing the settlement finality Directive (SFD). As a result, these entities will be covered by the obligation to offer the service of sending and receiving instant credit transfers, after a transitional period. The regulation includes appropriate safeguards to ensure that the access of PIEMIs to payment systems doesn’t carry additional risk to the system.

Under the new rules, instant payment providers will need to verify that the beneficiary’s IBAN and name match in order to alert the payer to possible mistakes or fraud before a transaction is made. This requirement will apply to regular transfers too.

The regulation includes a review clause with a requirement for the Commission to present a report containing an evaluation of the development of credit charges.

Background

This initiative comes in the context of the completion of the capital markets union. The capital markets union is the EU’s initiative to create a truly single market for capital across the EU. It aims to get investment and savings flowing across all member states for the benefit of citizens, businesses, and investors.

On 26 October 2022 the Commission put forward a proposal on instant payments that amends and modernises the single euro payments area (SEPA) regulation of 2012 on standard credit transfers in euro by adding to it specific provisions for instant credit transfers in euro.

Source: European Council

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FCA highlights need for enhanced competition in wholesale data markets

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The FCA has unveiled the outcomes of its in-depth study into the wholesale data market, focusing on the sectors of credit ratings data, benchmarks, and market data vendor services.

Despite deciding against major regulatory actions due to the risk of unintended consequences that could affect the data’s availability and quality—a crucial resource for global investors—the FCA has pinpointed several areas where competition could be significantly improved.

The study’s revelations indicate that the current state of competition in these markets may lead to users incurring higher costs for data than would be the case in a more competitive environment. This concern is particularly pressing given the critical role that such data plays in supporting effective investment decisions across the financial sector.

In a move to address these findings, the FCA has proposed initiatives aimed at ensuring wholesale data is distributed under fair, reasonable, and transparent conditions. This approach forms a part of the regulator’s broader strategy to ‘repeal and replace’ assimilated EU law, reinforcing the UK’s status as a premier global financial hub fostering investment, innovation, and sustainable growth.

Sheldon Mills, the FCA’s Executive Director of Consumers and Competition, emphasised the importance of quality and accessible wholesale data for the efficiency of financial markets. “The quality and availability of wholesale data is integral to well-functioning wholesale financial markets,” Mills stated. He further clarified, “Our market study found that firms can access the data they need to make effective investment decisions. We do not believe the case has been made for significant interventions. However, we will examine ways to help support wholesale data being provided on fair, reasonable and transparent terms.”

In its commitment to fostering a competitive and fair marketplace, the FCA will continue to scrutinize allegations of anti-competitive behavior across all markets, including wholesale data markets, leveraging its powers under the Competition Act to address any such issues.

Source: Fintech Global

 

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