Section 1033 Proposal Issued
The CFPB has issued a proposal to implement Section 1033 of the Consumer Financial Protection Act (CFPA). The purpose of Section 1033 is to promote fair and open banking. In other words, to make it easier for consumers to switch financial institutions which, in turn, will improve both customer service and more favorable terms for consumers.
The proposal states:
Digitization and decentralization in consumer finance create new possibilities for more
seamless consumer switching and greater competitive intensity. For example, when consumers are able to share their personal financial data, they can share details about their income and expenses that may give lenders more confidence when extending credit. When a consumer can switch with less friction, this will create incentives for superior customer service and more favorable terms. At the same time, sharing personal financial data can also lead to misuse and abuse, given its commercial value.
The proposed rule would require institutions to make certain transaction and account data available to consumers and authorized third parties. It also sets standards for both accessing and protecting that data.
Comments on the proposal are due on or before December 29, 2023.
Amy Kudlacek
Amy brings many years of banking and compliance experience to Banker’s Compliance Consulting. She has worked for both large and small financial institutions and spent time working in every area of a bank. She started out as a teller in college and eventually became a branch manager. Her love, however, was always compliance. Amy began her career with Banker’s Compliance Consulting in 2000. Her knowledge and experiences have allowed her to develop a well-rounded and practical approach to regulatory compliance. Amy is CRCM certified, has a Bachelors Degree in Business Administration and is a graduate of the ABA Compliance School. Amy & her husband have two children at home and stay busy following their activities. They spend a lot of time in the bleachers!