Data Sharing, Competition, and FinTech: A Transatlantic Divide?

Research project

Giuseppe Colangelo


Financial services are awash in data, and many financial services and products could be impacted by the increasing use of Big Data technologies. Big Data technologies may serve various purposes, from profiling customers and identifying patterns of consumption in order to make targeted offers and personalize products and services, to supporting finance and risk control activities.

The Fintech movement and the revised European Payment Services Directive (PSD2) provisions for access-to-account have accelerated the competition and digital disruption that are remodeling the financial services industry. Banks have traditionally exercised tight control over their clients’ account data. The PSD2, by introducing the access-to-account rule (XS2A rule), aims to facilitate the entry into the market of new payment solutions and payment-related services.

Several institutions and scholars believe that Application Programming Interface (API) is the most reliable technology to implement data (account) portability. However, there is no general consensus regarding who should define the APIs or, even more importantly, whether to create them in a standardized way. Imposing a set of APIs to companies would jeopardize future innovation, hampering competition among the market players seeking to adapt to the new legal frameworks. Therefore, the present study will assess which risks the implementation process carried out in the EU could pose for market innovation and competitiveness. Moreover, the research will analyze whether the US government should follow the route paved by the EU institutions, since other countries, such as the UK and Canada, are interested in supporting the Fintech movement and the Open Banking ecosystem.