In the King's Speech today (17 July 2024), King Charles III announced that his Government will bring forward Digital Information and Smart Data Bill.
- New Government announces Bill to bring forward Smart Data including Open Finance
- The Digital Information and Smart Data Bill will also introduce a proper system for digital verification services
This will legislate to create Smart Data Schemes, including Open Finance, bringing consumer benefits and greater inclusivity. Other benefits include the ability to produce new products and services as well providing greater insights into customers - enabling, for example, improved ability to underwrite finance. It will also introduce a proper system for digital verification services - bringing confidence in the technology which is essential for the delivery of smart data schemes and the FS sector as a whole.
During the last Parliament, the Data Protection and Digital Information (DPDI) Bill contained clauses which allowed the Financial Conduct Authority (FCA) to create a Smart Data scheme' - Open Finance, which would mandate financial institutions to share customers data with them and approved third-parties in real-time. This mandated data sharing and follows much the same principle as Open Banking, albeit applying to most, if not all other sub-sectors of Financial Services. The DPDI Bill also contained clauses to bring the Digital ID Trust Framework onto the statute books - something that not only helps for verification and KYC purposes but also allows many datasets to be linked with certainty to individuals or entities.
When the DPDI Bill failed to make the wash-up process following the dissolution of Parliament for the election, there was much disappointment as any significant delay would set the UK back in the global FinTech race.
techUK will continue to work with legislators and regulatory policy makers to represent members' views, shape the legislation and deliver policy insights back to the technology sector.
Responding to the Bill being included in the King's Speech, techUK's Head of Financial Services, Andy Thornley, said:
“This is really welcome news. When the DPDI Bill failed to make the wash-up process before the election, we were concerned there the UK's reputation as a leader in FinTech may be at risk due to delays - whilst other jurisdictions such as the EU continued to make progress.
“However, we're really pleased to see the new Government prioritising this work in the Digital Information and Smart Data Bill, which will boost the sector and deliver new innovations and services for their customers.”