The UK’s Financial Conduct Authority (FCA) is seeking industry input on whether the imbalance of data between Big Tech companies and financial services firms might enable companies like Amazon and Google to strengthen their market dominance in the financial services sector.
Big Tech’s influence in UK financial services is growing, particularly in areas such as payments, deposits, and consumer credit, with the potential for rapid market changes.
Last year, the FCA initiated a study to evaluate the possible competitive benefits and drawbacks stemming from this trend. Feedback from the industry revealed concerns over data asymmetry and data-sharing mechanisms. According to the FCA, this asymmetry occurs because financial services firms lack access to the extensive datasets held by Big Tech companies, which are not included in current data-sharing initiatives, while Big Tech has access to financial services data.
Some industry stakeholders worry that these tech giants could leverage their combined data with sophisticated analytics and artificial intelligence to influence competitive dynamics.
“We aim to gather more targeted information and evidence to evaluate the risk of a market environment where Big Tech firms gain significant market power due to this data asymmetry,” stated the FCA.
To facilitate this, the FCA has issued a ‘Call for Input,’ inviting financial services firms, Big Tech entities, fintech companies, trade associations, and consumer organizations to provide their insights and evidence by January 22.