The UK Government has successfully passed the Data (Use and Access) Bill through the House of Parliament, facilitating the growth of open banking and smart data sharing across various business sectors.
This legislation is crucial for expanding open banking beyond mere payments to a broader open finance model. It empowers consumers to share their data across diverse use cases in sectors such as energy, telecoms, transport, and retail.
This wider vision extends the concept of open data beyond financial institutions to include insurance, investments, pensions, and other financial services. For instance, an insurance provider might offer a comprehensive overview of existing pension products or enable access to loans and deposits data from multiple banks within a single application.
The UK Centre for Finance, Innovation and Technology (CFIT) has already developed two prototypes of open finance applications aimed at providing financial advice to vulnerable consumers and accelerating credit assessments for SME loan applications.
Potential use cases also include sharing mortgage data to streamline the property market and offer better utility bill deals.
Open Banking Limited CEO Henk Van Hulle remarked, “This is a landmark moment for the sector, but it is just the beginning. Now is the time to turn these foundations into real-world outcomes that empower consumers, drive innovation, and unlock growth.”
He emphasized that with the legislative groundwork in place for a smarter, more interconnected data economy, collaboration among government, regulators, and the industry is essential to transform this vision into reality. Critical decisions in the coming months will shape the ecosystem and outcomes for years to come.