TheCityUK response to the Financial Conduct Authority’s call for input on the potential data advantages of Big Tech firms over competitors in financial services
We submitted our response to the Financial Conduct Authority’s Call for Input on the potential data advantages of Big Tech firms over competitors in financial services. Data asymmetry exists in the financial services industry as is the case in other industries. The major difference is that regulated financial services are under a duty (regulatory, statutory or contractual) to make their data available. In contrast, unregulated firms in other industries are not so obligated.
Existing asymmetry with Big Tech could worsen as the tech and financial services sectors continue to merge, and Big Tech firms become more embedded in financial services.
Our key viewpoints are:
- Whilst it is impractical and unnecessary to bring every Big Tech firm within the financial services regulators’ perimeter for all their business, the FCA should take steps to create more of a level playing field for financial services market participants with Big Tech firms.
- The scope of this work should be expanded to cover wholesale markets in addition to retail markets while taking care not to add undue compliance burdens to what is already a heavily regulated space.
- The FCA should consider creating an equivalent unit to the Competition and Markets Authority’s Digital Markets Unit, and for these two units to develop a close working and communication relationship.
- It should be for individuals to determine how and to whom their data are made available. The UK approach must ensure that these individuals are sufficiently educated to make informed choices about their data.
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