The UK’s Competition and Markets Authority has relinquished control over its open banking unit following a bullying scandal.
The Financial Conduct Authority and Payments Systems Regulator will now oversee the Open Banking Implementation Entity’s transition to a new permanent body and regulate open banking technology in the immediate future.
Open banking allows banks, trusted third parties and technical providers to access consumer financial data (when the consumer consents) to allow more ways for consumers to spend, invest and borrow and allow businesses to provide them with services.
It has been estimated that by September 2023, 60 percent of the UK population will be using open banking payments.
The CMA was tasked with overseeing the open banking unit in 2016 to encourage banks to share customer information to encourage account switching and boost competition.
However, the unit became engulfed in a bullying scandal which led to the resignation of its chairman in October. The independent report found a “toxic culture” of bullying and intimidation at the organisation and claimed the CMA did little to act on problems when they became apparent.
Related: Antitrust Chronicle – Open Banking
The new regulatory committee will work with OBIE, but the unit’s future remains uncertain as the watchdogs and the Treasury consider creating a new entity. The CMA ordered nine UK banks and building societies to set up the OBIE in 2017, to encourage big banks to share customer information with startups and fintechs, and address a lack of competition in the financial sector.
The CMA said “Recommendations will be taken into consideration in the design of a future entity to succeed the Open Banking Implementation Entity. The future entity would build on the significant progress made to date by the OBIE to encourage innovation and support competition in retail banking.”
Open Banking is an initiative launched by the CMA in 2017 following its Retail Banking Market Investigation. It allows consumers and SMEs to share their bank account information securely with trusted intermediaries who can then use this information to help them save time and money by finding better products to suit their needs.
Want more news? Subscribe to CPI’s free daily newsletter for more headlines and updates on antitrust developments around the world.
Featured News
T-Mobile’s Acquisition of Ka’ena Corporation Receives FCC Approval
Apr 26, 2024 by
CPI
UK Regulator Announces Two New Senior Executive Appointments
Apr 26, 2024 by
CPI
Paramount Global and Skydance Media Near Merger Deal, Eyeing CEO Change
Apr 26, 2024 by
CPI
BHP Unveils £31bn Mining Megamerger Proposal with Anglo American
Apr 25, 2024 by
nhoch@pymnts.com
ByteDance Prefers Shutdown Over Sale of TikTok Amid US Ban Threats
Apr 25, 2024 by
CPI
Antitrust Mix by CPI
Antitrust Chronicle® – Economics of Criminal Antitrust
Apr 19, 2024 by
CPI
Navigating Economic Expert Work in Criminal Antitrust Litigation
Apr 19, 2024 by
CPI
The Increased Importance of Economics in Cartel Cases
Apr 19, 2024 by
CPI
A Law and Economics Analysis of the Antitrust Treatment of Physician Collective Price Agreements
Apr 19, 2024 by
CPI
Information Exchange In Criminal Antitrust Cases: How Economic Testimony Can Tip The Scales
Apr 19, 2024 by
CPI