Yesterday, the CFPB published the final Section 1033 rule. Here’s our summary of a few key aspects of the final rule.

 The CFPB published the final Section 1033 rule that gives consumers greater control and rights over personal financial data. Here’s MX's summary of a few key aspects.

Section 1033 Final Rule: Quick Takes on Key Changes | MX Blog

Yesterday, the Consumer Financial Protection Bureau <a href="https://www.consumerfinance.gov/about-us/newsroom/cfpb-finalizes-personal-financial-data-rights-rule-to-boost-competition-protect-privacy-and-give-families-more-choice-in-financial-services/">published the final Section 1033 rule</a> that will give consumers greater control and rights over their personal financial data. While we are still reviewing closely, the 594-page final rule seems to be largely the same as the proposed rule with a few key changes and clarifications.&nbsp;
At MX, our mission is to empower the world to be financially strong. And, at the core of delivering on that mission is the ability for consumers and the financial providers who serve them to connect, understand, and act on their permissioned financial data. This final rule is a huge milestone in making sure consumers have the right to access and control that financial information. Here&rsquo;s our summary of a few key aspects of the final rule as we continue our review:
<h2>Extending Compliance Deadlines</h2>
Compliance deadlines have been extended to allow for more time for data providers and third parties to meet these new expectations. And, the smallest institutions (banks and credit unions with less than $850 million in assets), will not be required to provide data under the rule.
New compliance deadlines for institutions with more than $850M in assets are:&nbsp;
<img src="https://cms.mx.com/assets/3ede7f0b-a0fe-49ae-9773-24a7cbb39482?width=1200&amp;height=738" alt="1033 Compliance Timeline" />
<h2>Continuing to Start Small on Scope of Data</h2>
The scope of data remains largely the same from the draft rule, and we should continue to expect additional rules over time to address other products and services.&nbsp;
Covered data includes Reg E accounts, Reg Z credit cards, digital wallets, and payment facilitation products. The only difference here from the draft rule is excluding first-party payments as part of those payment facilitation products. <a href="https://www.consumerfinance.gov/rules-policy/final-rules/required-rulemaking-on-personal-financial-data-rights/">According to the final rule</a>, &ldquo;first-party payments are distinct from payment facilitation products. Accordingly, the CFPB is &hellip; explicitly excluding products or services that merely facilitate first-party payments. For purposes of this definition, a first-party payment is a transfer initiated by the payee or an agent on behalf of the underlying payee. First-party payments include payments initiated by a loan servicer.&rdquo;
Again, this is just the first wave of covered data. Chopra said in <a href="https://www.consumerfinance.gov/about-us/newsroom/prepared-remarks-of-cfpb-director-rohit-chopra-at-the-federal-reserve-bank-of-philadelphia-on-the-personal-financial-data-rights-rule/">remarks at the Federal Reserve Bank of Philadelphia</a> yesterday that &ldquo;the CFPB will be developing a roadmap for the next set of rules to advance open banking. &hellip; We are considering a number of other use cases, such as how to reduce costs and complexity in the mortgage market. During the rulemaking process, there were a number of important issues raised, such as coverage of accounts used for government benefits and the ability for nonprofit researchers to use consumer-permissioned data.&rdquo;
<h2>Using Data for Consumer Benefit &mdash; A Word on Secondary Use Cases&nbsp;</h2>
The final rule provides expanded guidance and clarity on the reasonable use of consumer-permissioned data by authorized third parties. The language now calls out &ldquo;purposes&rdquo; rather than &ldquo;activities&rdquo; when it comes to secondary use cases. We think this is important as it&rsquo;s the intent rather than a list of actions that matters. We strongly believe consumer financial data should only be used to ultimately benefit the consumer &mdash; and not used in ways that are purely value extraction or advantages to an organization to the detriment of the consumer.
<a href="https://www.consumerfinance.gov/about-us/newsroom/prepared-remarks-of-cfpb-director-rohit-chopra-at-the-federal-reserve-bank-of-philadelphia-on-the-personal-financial-data-rights-rule/">At the Federal Reserve Bank of Philadelphia</a>, Chopra said, &ldquo;it&rsquo;s pretty simple. A company that ingests consumer&rsquo;s data can use the data to provide the product or service the consumer asked for, but not for unrelated purposes the consumer doesn&rsquo;t want.&rdquo;&nbsp;
The CFPB states that consumer-permissioned data can be used to improve the product or service that the consumer requested without separate authorizations. For instance, this could include data enhancement to translate raw transaction data into understandable and actionable information for consumers. But, the final rule doesn&rsquo;t allow for things like targeted advertising, cross-selling of other products or services, or the sale of covered data by a third party.&nbsp;
Chopra further stated that &ldquo;the rule is designed to ensure that open banking does not become a new data pipeline that fuels surveillance pricing or other manipulative mischief.&rdquo;&nbsp; If a consumer chooses to share their financial data in order to gain a better experience, we have a responsibility to use that data to drive the best results possible for them and not cause harm.&nbsp;
<h2>What&rsquo;s Next</h2>
With the first compliance deadline now set, it&rsquo;s time to dive into the technical details and performance requirements in depth to ensure APIs, processes, and interfaces meet the final rule.&nbsp;
In addition, the CFPB published the <a href="https://www.consumerfinance.gov/about-us/blog/cfpb-launches-public-comment-process-for-open-banking-standard-setter-recognition/">first application seeking recognition as an open banking standard-setter</a> from the Financial Data Exchange (FDX) in September. While the final rule mostly adjusts any standards language to call out a &ldquo;consensus standard&rdquo; to meet requirements, a recognized standard-setting organization will go a long way in helping create that consensus.&nbsp;
We&rsquo;re excited about this next step in the U.S. towards a more open, competitive, and innovative ecosystem for the benefit of consumers. We look forward to continuing to lead with privacy-first principles and ensuring our clients can meet these new compliance obligations and leverage consumer-permissioned data effectively and ethically.

Section 1033 Final Rule: Quick Takes on Key Changes — Deadlines, Scope, and Secondary Use

MX is excited to share that Founder Ryan Caldwell has returned to the company as Chief Executive Officer.

Caldwell founded MX in 2010 with a mission he and Co-Founder Brandon Dewitt established that continues today — empowering the world to be financially strong.

MX Announces Return of CEO and Founder Ryan Caldwell

Today, MX is excited to share that Founder Ryan Caldwell has returned to the company as Chief Executive Officer, effective immediately. Ryan has been serving as the Executive Chair of the MX Board of Directors since stepping down as CEO in 2021.
In late 2021, Caldwell made the difficult decision to step aside as CEO to focus on his daughter&rsquo;s health. She is doing much better and getting stronger every day, making it the right time for Ryan to return as CEO. We are excited to welcome Ryan back to MX in a full-time capacity.&nbsp;
&ldquo;I am excited to return to MX at such a pivotal moment for both the company and the industry, as financial institutions and fintechs look to leverage consumer-permissioned financial data to grow deposits, increase innovation, and deliver new products and services that strengthen outcomes,&rdquo; said Caldwell. &ldquo;We have an incredible team and opportunity ahead of us to innovate faster and enable real, tangible benefits for consumers and the financial providers that serve them.&rdquo;&nbsp;
Caldwell founded MX in 2010 with a mission he and Co-Founder Brandon Dewitt established that continues today &mdash;&nbsp;empowering the world to be financially strong. MX does this by delivering the industry&rsquo;s most robust and reliable connectivity, data enhancement, and experience solutions to financial services providers.
Additionally, we are excited to share that Chief Technology Officer Wes Hummel will take on an expanded role leading both the MX product and technology teams.&nbsp;

MX Founder Ryan Caldwell Returns as Chief Executive Officer

Here’s 5 key insights from our survey of 1,000+ U.S. consumers that financial providers should consider to increase engagement.

Here’s 5 key insights from our latest survey of 1,000+ U.S. consumers that financial providers should consider to increase consumer engagement. 

Increase Consumer Engagement With Intuitive Money Management Tools

Our latest research shows 25% of U.S. consumers feel completely financially secure today. And, more than half (56%) of respondents say they will be financially secure someday.&nbsp;
But, while they may feel optimistic for the future, they are still worried about the everyday costs of groceries, housing, and more continue to rise due to inflation. And, they may be stuck in old ways when it comes to solving these feelings of financial insecurity.&nbsp;
<blockquote>
&ldquo;In today&rsquo;s increasingly challenging economic environment, it&rsquo;s interesting to see a majority of consumers still relying on manual processes &mdash; adding more burden and potentially stress to managing their finances,&rdquo; shares Jane Barratt, Chief Advocacy Officer and Head of Global Public Policy, MX.&nbsp;
</blockquote>
Financial institutions and fintechs have an opportunity to play a bigger role in helping consumers achieve financial security by relieving the mental burden with proactive, personalized notifications and intuitive money management tools that can do the heavy lifting for them.&nbsp;
Here&rsquo;s 5 key insights from our latest survey of 1,000+ U.S. consumers that financial providers should consider in meeting this opportunity head on:
<h2>1. Consumers still turn to manual bill pay methods over automation. </h2>
When asked what most closely aligns with how they pay bills on a monthly basis, 40% of all respondents say they prefer to manually view and pay each bill every month to keep track of their finances. An additional 24% say they manually pay each bill to make sure they have the funds available.&nbsp;
<h2>2. Incentives could drive consumers to change their payment habits. </h2>
While the majority of consumers (51%) prefer to keep their payment methods the same for convenience, more than one-third (36%) would consider switching if they received an incentive.
<h2>3. The keys to direct deposit switching are rates and rewards. </h2>
When asked if they have ever switched their direct deposit to a different financial institution, the majority (65%) say no. But, nearly half say the top factors that are most likely to make them switch are the ability to earn higher interest rates (22%) or receive cash back incentive or offer to earn rewards for switching (22%).&nbsp;
<h2>4. Personalization is critical. </h2>
Consumers are looking for a financial provider that knows them and puts that knowledge into practice through personalized insights and tools. Forty-nine percent of consumers expect their financial provider to know them. And, 47% of consumers expect greater levels of personalization in banking than ever before. 
<h2>5. Actionable intelligence drives higher engagement and even more data. </h2>
More than half expect their financial provider to leverage the data they have about them to personalize their experience (53%) and provide them with actionable and clear insights about their finances (56%). What&rsquo;s more &mdash;&nbsp;consumers will share even more data if it results in a better experiences.&nbsp;
To read the full report, please visit: <a href="https://www.mx.com/research/driving-engagement-for-consumers-research/">https://www.mx.com/research/driving-engagement-for-consumers-research/</a>

How to Encourage Consumers to Use New Money Management Approaches 

Financial data intelligence makes financial data actionable to increase engagement, improve results, and drive growth.

Financial data intelligence is the ability to make financial data actionable to increase engagement and loyalty, improve results, and drive growth. 

What is Financial Data Intelligence? Definitions and Benefits

In this post, we will cover: 
<ul>
<li><a href="#what-is-financial-data-intelligence">What is Financial Data Intelligence?</a></li>
<li><a href="#definitions">Financial Data Intelligence vs. Data Analytics, and Other Terms</a></li>
<li><a href="#how-financial-data-intelligence-works">How Financial Data Intelligence Works</a></li>
<li><a href="#benefits-financial-data-intelligence">Benefits of Financial Data Intelligence</a></li>
</ul>
<h2 id="what-is-financial-data-intelligence">What is Financial Data Intelligence?&nbsp;</h2>
Vast amounts of consumer financial data are generated daily by each and every consumer. One transaction alone can mean dozens of data points. As a result, banks, credit unions, fintechs, and other financial providers are sitting on mountains of financial data.&nbsp;
However, the majority of financial institutions and fintechs don&rsquo;t have a good way to unlock the value of this data to drive better business and consumer outcomes. But, data is just data. You need to <a href="https://www.mx.com/guides/2024-digital-banking-playbook/">create an actionable step</a> for your customers.
That&rsquo;s where financial data intelligence comes into the picture. Financial data intelligence is the ability to make financial data actionable to increase engagement and loyalty, improve results, and drive growth.&nbsp;
<h2 id="definitions">Financial Data Intelligence vs. Data Analytics, and Other Terms</h2>
Financial data intelligence is a term specific to how organizations leverage consumer financial data. It is a subset of a broader term &mdash;&nbsp;data intelligence, which is used across many industries such as retail, healthcare, manufacturing, etc., when talking about deriving actionable insights from data. Data intelligence is the tools and methods that organizations use to better understand the data they collect, store, and utilize to improve their products and/or services.&nbsp;
Other organizations may refer to similar terms including data analytics and business intelligence when referring to how they analyze data. However, we think data analytics misses a key component that is present with data intelligence: making it actionable. Analysis without action is simply interesting information. To create true data intelligence, the data and insights must be actionable.&nbsp;
<blockquote>
Analysis without action is simply interesting information. To create true data intelligence, the data and insights must be actionable.&nbsp;
</blockquote>
Another similar term that is worth mentioning is &ldquo;<a href="https://en.wikipedia.org/wiki/Financial_intelligence">financial intelligence</a>.&rdquo; What is financial intelligence? It&rsquo;s defined as gathering information about the &ldquo;financial affairs of entities of interest, to understand their nature and capabilities, and predict their intentions.&rdquo; It&rsquo;s often used in conjunction with an investigation of a specific entity by law enforcement or related agencies. In fact, the United States government has an <a href="https://en.wikipedia.org/wiki/Under_Secretary_of_the_Treasury_for_Terrorism_and_Financial_Intelligence">under secretary position within the Department of the Treasury</a> dedicated to terrorism and financial intelligence.&nbsp;
<h2 id="how-financial-data-intelligence-works">How Financial Data Intelligence Works</h2>
It starts with being able to effectively <a href="https://www.mx.com/products/connectivity/">connect</a> to, understand, and act on consumer financial data.&nbsp;
<h3>Connecting the Dots</h3>
Today&rsquo;s <a href="https://www.mx.com/research/what-consumers-want-from-financial-providers/">average consumer has 3 to 5 financial accounts</a> with various banks, credit unions, and other financial providers. It&rsquo;s messy for consumers to manage and makes it increasingly difficult for financial providers to get a full picture of consumers&rsquo; financial lives.&nbsp;
This disjointed <a href="https://www.mx.com/money-experience/">money experience</a> creates blindspots for organizations when it comes to delivering the right products and services to meet consumer needs, targeting consumers with the right messages, and accurately predicting and preventing churn.&nbsp;
By enabling consumers to easily connect and view all of their finances in one place with <a href="https://www.mx.com/products/account-aggregation/">financial account aggregation</a>, it not only helps consumers better manage their money but gives financial providers more visibility into consumer financial data.&nbsp;
<h3>Understanding the Data</h3>
As we stated earlier, data is just data. It requires context, cleansing, and categorization to ensure both consumers and organizations can leverage data to its fullest extent.&nbsp;
With cleansing and categorization, raw data becomes clear transaction information. And, with added context, transaction data becomes more insightful and actionable for consumers. <a href="https://www.mx.com/products/data/">Enhanced data</a> also makes it easier to unlock the value of financial data and enable better decisions, improve efficiency, and uncover new opportunities.
<h3>Creating Actionable Insights and Personalized Experiences</h3>
The last piece of the puzzle is how you leverage the data to <a href="https://www.mx.com/blog/personal-data-in-exchange-for-personalized-experiences/">create personalized experiences</a>, deliver proactive insights, and drive engagement and growth.&nbsp;
Financial data intelligence combines connected and enhanced data with the power of artificial intelligence, machine learning, and advanced analytics. It helps financial service providers to increase engagement with consumers by delivering insights and recommended actions to help them on their financial journey and surface new insights and areas of opportunity to drive growth.&nbsp;&nbsp;
<div style="padding: 56.25% 0 0 0; position: relative;"><iframe style="position: absolute; top: 0; left: 0; width: 100%; height: 100%;" title="Financial Data Intelligence Promo - Sachi - March 2024" src="https://player.vimeo.com/video/928032801?h=4c12f88c79&amp;badge=0&amp;autopause=0&amp;player_id=0&amp;app_id=58479" frameborder="0"></iframe></div>
<h3>The Benefits of Financial Data Intelligence&nbsp;</h3>
Simply put: with actionable financial data intelligence, financial providers can increase engagement and loyalty, acquire more customers, and identify growth opportunities. And, financial providers can help their customers better understand and manage their finances.&nbsp;
Here&rsquo;s a look at our top 10 benefits of financial data intelligence:&nbsp;
<ol>
<li style="font-weight: 400;" aria-level="1">Acquire and retain more customers with <a href="https://www.mx.com/products/connectivity/">reliable connectivity solutions</a>, <a href="https://www.mx.com/products/data/">enhanced data</a>, and <a href="https://www.mx.com/products/experience/">personalized digital experiences</a>.</li>
<li style="font-weight: 400;" aria-level="1">Increase consumer engagement and adoption by delivering <a href="https://www.mx.com/products/financial-insights/">personalized financial insights</a> and recommended actions.</li>
<li style="font-weight: 400;" aria-level="1">Surface areas of opportunity to increase deposits, expand <a href="https://www.mx.com/use-cases/account-opening/">account openings</a>, and engage with your customers.</li>
<li style="font-weight: 400;" aria-level="1">Improve financial health by enabling consumers to better understand and manage their finances with <a href="https://www.mx.com/products/personal-financial-management/">Personal Financial Management (PFM) tools</a>.</li>
<li style="font-weight: 400;" aria-level="1">Deliver the right message, to the right person, at the right time to<a href="https://www.mx.com/products/customer-analytics/"> improve ROI and marketing campaign effectiveness</a>.</li>
<li style="font-weight: 400;" aria-level="1">Predict and prevent churn with a better understanding of trends and behaviors</li>
<li style="font-weight: 400;" aria-level="1">Increase customer satisfaction and loyalty with <a href="https://www.mx.com/products/experience/">personalized experiences</a> that meet consumers where they are.</li>
<li style="font-weight: 400;" aria-level="1">Optimize business processes by breaking down data silos and making it easier to unlock the value of financial data.</li>
<li style="font-weight: 400;" aria-level="1"><a href="https://www.mx.com/case-studies/becu/call-center/">Reduce call center volume</a> and customer frustration by making data easily understandable and actionable.</li>
<li style="font-weight: 400;" aria-level="1">Accelerate innovation and product enhancements based on actionable data about product adoption, usage, and behaviors.</li>
</ol>

What is Financial Data Intelligence? How it Works, Key Definitions & Benefits

The CFPB's Section 1033 of the Dodd-Frank Act is an important milestone in ensuring consumers have the right to their financial information.

Join us on Monday, November 6, for a virtual roundtable discussion to ask questions and share your perspective. 

What is CFPB Dodd-Frank Act Section 1033?

In this post, we will cover:
<ul>
<li><a href="#what-is-1033">What is the Dodd-Frank Act Section 1033?</a></li>
<li><a href="#what-is-the-cfpb">What is the Consumer Financial Protection Bureau (CFPB)?</a></li>
<li><a href="#why-is-1033-important">Why is Section 1033 Important?</a></li>
<li><a href="#what-data-is-covered">What Data is Covered by Section 1033?</a></li>
<li><a href="#compliance-dates">When Will Financial Providers Need to be Compliant?</a></li>
<li><a href="#whats-next">What&rsquo;s Next?</a></li>
<li><a href="#why-data-rights-matter">Why Consumer Financial Data Rights Matter</a></li>
<li><a href="#why-standardized-apis">Why Standardized APIs are Important</a></li>
<li><a href="#how-mx-can-help">How MX Can Help</a></li>
<li><a href="#additional-resources">Additional 1033 Resources</a></li>
</ul>
At MX, core to delivering on our mission to empower the world to be financially strong is the ability for consumers to access, direct, and control their financial data to improve their financial outcomes.
We believe in the power of financial data to unlock new insights and drive better money experiences that benefit companies and consumers alike. To enable better decisions, experiences, and outcomes, financial data should be accessible and actionable for all consumers to better enable decisions, experiences, and outcomes. And, increased competition, a level playing field, and increased digital innovation can help improve financial outcomes for consumers.
However, until now, consumer financial data access and control has primarily been left up to the financial institutions, fintechs, and other third parties involved. MX has been working with our clients, partners, and the wider financial services ecosystem to accelerate <a href="https://www.mx.com/blog/what-is-open-banking/">Open Banking</a> and secure, <a href="https://www.mx.com/blog/what-is-consumer-permissioned-data/">consumer-permissioned data</a> sharing for nearly a decade.
On October 19, 2023, the Consumer Financial Protection Bureau (CFPB) published its long-awaited <a href="https://www.consumerfinance.gov/about-us/newsroom/cfpb-proposes-rule-to-jumpstart-competition-and-accelerate-shift-to-open-banking/">notice of proposed rulemaking (NPRM)</a> for personal financial data rights under Dodd-Frank Act Section 1033. We believe that the success of the financial industry, future innovation, and the financial health of Americans can all be greatly enhanced by increased clarity of data rights and the promulgation of this 1033 rulemaking. Now, we&rsquo;re likely just weeks away from the anticipated final rule from the CFPB.
Once final, the clock starts for financial data providers and recipients to meet outlined compliance timelines and requirements. The compliance period will vary depending on the size of each institution. But, that doesn&rsquo;t mean wait. The time is now for financial institutions to begin getting ready to meet obligations under this new rule.
<h2 id="what-is-1033">What is the Dodd-Frank Act Section 1033?&nbsp;</h2>
In 2010, Congress passed the Dodd-Frank Wall Street Reform and Consumer Protection Act, also known as the Dodd-Frank Act. Section 1033 is an important milestone to ensure consumers have the right to access and control their financial information.
It authorizes the CFPB to prescribe rules requiring &ldquo;a covered person [to] make available to a consumer, upon request, information in the control or possession of the covered person concerning the consumer financial product or service that the consumer obtained from such covered person, including information relating to any transaction, series of transactions, or to the account including costs, charges and usage data.&rdquo;
<blockquote>
Getting ready for 1033? <a href="https://www.mx.com/open-banking-made-easier/" target="_blank" rel="noopener">Schedule a strategy session</a> to help you prepare for the final rule.
</blockquote>
<h2 id="what-is-the-cfpb">What is the Consumer Financial Protection Bureau (CFPB)?</h2>
The Consumer Financial Protection Bureau (CFPB) is a U.S. government agency that aims to protect consumers from unfair treatment by financial institutions. In its own words, the CFPB is &ldquo;dedicated to making sure you are treated fairly by banks, lenders and other financial institutions.&rdquo; It implements and enforces Federal consumer financial law and ensures that markets for consumer financial products are fair, transparent, and competitive.
<h2 id="why-is-1033-important">Why is Section 1033 Important?</h2>
This rulemaking is one of the most substantive regulatory changes to happen in the financial industry in many years. It fundamentally changes, for the better, how consumers can access and share their financial data. And, it will lay the groundwork for the United States to move into the next chapter of fintech innovation.
A clear, cross-agency regulatory framework will accelerate adoption of <a href="https://www.mx.com/blog/what-is-open-finance/" target="_blank" rel="noopener">Open Finance</a>, improve the money experience, and help drive better financial outcomes for millions of Americans.
But, Open Finance isn&rsquo;t simply a checkbox to meet forthcoming 1033 compliance and regulatory obligations. It provides significant benefits to consumers and financial services providers.&nbsp;
Consumers gain more choice and control over the data they share and how they engage with their finances with the freedom and flexibility that Open Finance enables. And, they gain unparalleled access to a broader range of products and services.
It also allows consumers to more easily connect their various financial accounts and data together into a single view &mdash; enabling a more seamless money experience.
For financial services providers, Open Finance enables:
<h3>Better Fraud and Risk Management</h3>
By leveraging an open finance API rather than screen scraping, consumers never have to share their username and password, and financial providers eliminate the risk of sharing credentials.
<h3>More Accurate Customer Profiles</h3>
Financial providers can gain access to real-time consumer-permissioned financial data. This helps them better understand their customer needs and identify product and partnership opportunities.
<h3>Enhanced Customer Experiences</h3>
By putting consumers in the driver&rsquo;s seat, financial providers can build trust and improve relationships, leading to greater customer satisfaction and loyalty. And, with better visibility into a consumer&rsquo;s financial life, financial providers can deliver more personalized, intuitive experiences to meet them where they are.
<h2 id="what-data-is-covered">What Data is Covered by Section 1033?&nbsp;</h2>
It&rsquo;s important to note that the CFPB isn&rsquo;t attempting to cover the entire financial ecosystem with this initial rule under Section 1033. It specifically calls out Regulation E accounts and Regulation Z credit card accounts to start, as well as digital wallets and payment facilitation products.
This includes:
<ul>
<li>Checking accounts</li>
<li>Savings accounts</li>
<li>Credit cards</li>
<li>Prepaid cards</li>
<li>Digital wallets</li>
<li>Other electronic payments</li>
</ul>
But, it does exclude first-party payments as part of those payment facilitation products, which the CFPB defines as a transfer initiated by the payee or an agent on behalf of the underlying payee. First-party payments include payments initiated by a loan servicer.
Within these types of accounts, specific covered data outlined includes:
<ul>
<li>Transaction information, including historical transaction information</li>
<li>Account balances</li>
<li>Information to initiate payment to or from a Regulation E account</li>
<li>Terms and conditions related to providing a consumer financial product or service</li>
<li>Upcoming bill information</li>
<li>Basic account verification information</li>
</ul>
Exceptions to this covered data would include:
<ul>
<li>Any confidential commercial information, including an algorithm used to derive credit scores or other risk scores or predictors</li>
<li>Any information collected by a data provider for the purpose of preventing fraud or money laundering, or detecting, or making any report regarding other unlawful or potentially unlawful conduct</li>
<li>Any information required to be kept confidential by any other provision of law</li>
<li>Any information that a data provider cannot retrieve in the ordinary course of its business</li>
</ul>
<h2 id="compliance-dates">When Will Financial Providers Need to be Compliant?</h2>
In the final rule, the CFPB has extended compliance deadlines beyond the <a href="https://www.consumerfinance.gov/rules-policy/notice-opportunities-comment/open-notices/required-rulemaking-on-personal-financial-data-rights/" target="_blank" rel="noopener">NPRM</a> to allow for more time for data providers and third parties to meet expectations. And, the smallest institutions (banks and credit unions with less than $850 million in assets), will not be required to provide data under the rule.
Compliance deadlines in the final rule for institutions with more than $850M in assets are:
<img src="https://cms.mx.com/assets/4a891c23-7bb4-48d7-880e-2391f7ee3df8?width=1200&amp;height=738" alt="1033 Compliance Deadlines" />
<h2 id="whats-next">What&rsquo;s Next?</h2>
With the final rule in place, now is the time to start understanding what it means for your organization and make plans to meet outlined compliance data.&nbsp;
In addition, the CFPB finalized a rule in June 2024 that outlines the qualifications to become a <a href="https://www.consumerfinance.gov/personal-financial-data-rights/applications-for-open-banking-standard-setter-recognition/#:~:text=The%20rule%20identifies%20the%20attributes,process%20and%20appeals%2C%20and%20transparency." target="_blank" rel="noopener">recognized industry standard-setting body</a>, which can issue consensus standards that companies can use to help them comply with the CFPB&rsquo;s upcoming Personal Financial Data Rights Rule. The rule identifies the attributes that standard-setting bodies must demonstrate in order to be recognized by the CFPB as an open banking standard setter, including:&nbsp;
<ul>
<li>Openness: The process must be open to all interested parties.</li>
<li>Transparency: Procedures must be transparent and publicly available.</li>
<li>Balanced decision-making: No single special interest should dominate the process. The decision-making power to set standards must be balanced across all interested parties, including consumer and other public interest groups.</li>
<li>Consensus: Standards development must proceed by consensus, with fair consideration of comments and objections.</li>
<li>Due process and appeals: The body must use documented, publicly available policies and procedures, including adequate notice of meetings, time for review, and an impartial appeals process.</li>
</ul>
The <a href="https://www.mx.com/blog/why-fdx-matters/#what-is-fdx" target="_blank" rel="noopener">Financial Data Exchange (FDX)</a> submitted the first application to be recognized as an industry standard-setting body for open banking. The CFPB is currently taking public <a href="https://www.consumerfinance.gov/about-us/blog/cfpb-launches-public-comment-process-for-open-banking-standard-setter-recognition/" target="_blank" rel="noopener">comments on the FDX application</a>. Today, more than <a href="https://financialdataexchange.org/FDX/News/Announcements/FDX%20Hits%2094%20Million%20Accounts,%20CFPB%20Publishes%20FDX's%20Standard-Setting%20Application.aspx" target="_blank" rel="noopener">94 million consumer accounts</a> are now actively using the <a href="https://www.mx.com/blog/why-fdx-matters/#what-does-fdx-api-include" target="_blank" rel="noopener">FDX API</a> for secure, permissioned data sharing.
<h2 id="why-data-rights-matter">Why Consumer Financial Data Rights Matter</h2>
<a href="https://www.mx.com/whitepapers/open-finance-creates-a-better-money-experience/">Today&rsquo;s money experience is inherently messy</a> both for consumers and financial providers seeking to meet increasingly complex consumer needs. Consumers must look across a multitude of financial accounts to try to manage their financial life &mdash;&nbsp;with most maintaining relationships with an average of 5 to 10 different financial services organizations, from their primary bank to PayPal and Venmo to various credit cards, investment accounts, and loans. And, today&rsquo;s closed financial ecosystem makes it difficult for consumers to switch to a new financial provider or take their financial data with them.&nbsp;&nbsp;
We&rsquo;ve all heard the expression that knowledge is power. Engaging with their finances on multiple platforms means they don&rsquo;t have a consolidated view of their financial data or who may be accessing it. And, if they ever choose to leave their current providers, it&rsquo;s not easy to transfer and take their financial data with them.&nbsp;
Consumers should own, have access to, and have the ability to control all their financial data. Full stop. And, <a href="https://www.mx.com/research/what-influences-where-consumers-choose-to-bank/">consumers overwhelmingly agree (82%) that they own their financial data</a> and should be able to control who has access to it.&nbsp;
This empowers consumers to better understand their finances and make financial decisions that will improve their overall health (e.g., seek improved interest rates, increase savings rates, etc.) &mdash;&nbsp;as well as spur innovation and competition in the marketplace.&nbsp;
<h2 id="why-standardized-apis">Why Standardized APIs are Important</h2>
Most financial data sharing still relies on less reliable and less secure methods that require consumers to share credentials with a third party. This <a href="https://www.mx.com/blog/screen-scraping-vs-bank-apis-whats-the-difference/" target="_blank" rel="noopener">screen scraping</a> or credential sharing is less reliable and places a heavy technical burden on bank infrastructure, which creates an unstable customer experience. Connections frequently break as passwords, systems, and processes change.&nbsp;
This leads to frustration and could potentially cost businesses customers in the long run. Screen scraping also puts consumers and businesses at increased risk since it requires consumers to provide usernames and passwords to a third party. And, consumers may be left wondering who has access to their data while businesses have little visibility into where data is shared.
An open banking or open finance application programming interface (API) allows consumers to access their transaction data without the need to share usernames and passwords, and eliminates the technical burden of screen scraping. Direct connections replace credentials with tokens, delivering higher levels of security, faster speeds, and higher connection success rates.&nbsp;
<h2 id="how-mx-can-help">How MX Can Help</h2>
MX is making it easier than ever for financial institutions of all sizes to accelerate open finance adoption and enhance the money experience for consumers through our <a href="https://www.mx.com/products/data-access/" target="_blank" rel="noopener">Data Access</a> solution.
Built to FDX standards, Data Access improves the data sharing experience with a secure, open finance API. It also enables financial institutions to better monitor and manage where data is shared, unlock actionable insights to drive growth and retention, and meet expected 1033 compliance obligations.&nbsp;
Financial providers can better monitor and manage what data is leaving their platform and where it goes, uncovering new opportunities to grow. Plus, automated notifications and reporting make it easy to detect anomalies, identify customer needs, and report on compliance requirements.
Let us help you get started with making sense of expected obligations &mdash; and opportunities &mdash; within your open banking journey. Talk to our experts today.
<h2 id="additional-resources">Additional Section 1033 Resources</h2>
Tap into our library of resources to learn more about Section 1033.
<ul>
<li><a href="https://www.mx.com/whitepapers/how-data-access-supports-1033/" target="_blank" rel="noopener">How MX&rsquo;s Data Access Can Help Financial Providers Get Ready for Section 1033</a></li>
<li><a href="https://mx.com/guides/where-financial-providers-may-fall-short-on-1033-reqs/" target="_blank" rel="noopener">Getting Ready for Section 1033 Obligations: Where Financial Providers May Fall Short</a></li>
<li><a href="https://www.youtube.com/watch?v=BLH5pIQrsxg&amp;t=15s" target="_blank" rel="noopener">CFPB Director Chopra Addresses FDX Spring Global Summit</a></li>
<li><a href="https://www.mx.com/whitepapers/secondary-use-cases/" target="_blank" rel="noopener">Why Enabling Secondary Use Cases for Consumer Benefit is Critical</a></li>
<li><a href="https://www.mx.com/whitepapers/mx-perspective-on-consumer-data-rights-rulemaking/" target="_blank" rel="noopener">MX Comments on the CFPB&rsquo;s Required Rulemaking on Personal Financial Data Rights</a></li>
</ul>

Understanding CFPB Section 1033 — Establishing Consumer Financial Data Rights in the United States

Innovation is key to keeping consumers engaged and staying competitive in today’s banking environment.

Check out key takeaways from CCG Catalyst’s research into technical readiness, new technology, and new business opportunities for banks.

Banks Attitudes Towards New Technology and Business Frontiers

Innovation is key to staying competitive in today&rsquo;s banking environment. It&rsquo;s easier than ever for consumers to switch banks, so bankers need to offer innovative products and services that keep consumers engaged.
CCG Catalyst recently published its newest research <a href="https://www.ccgcatalyst.com/thought-leadership/research/new-frontiers-in-banking-2024-balancing-caution-and-excitement/">New Frontiers in Banking 2024: Balancing Caution and Excitement</a> to help executives better understand peer perspectives on different innovation areas. CCG Catalyst surveyed C-suite executives across the U.S. about their attitudes in today&rsquo;s banking innovation environment.
Here are a few key takeaways from the report:&nbsp;
<h2>Technical Readiness and Expectations</h2>
Forty-four percent of C-suite executives ranked their bank as generally prepared technologically for the future, while 31% said they will likely outpace their competition. The vast majority of banks feel confident in their technology&rsquo;s ability to handle the next 5 years.
&ldquo;It&rsquo;s prudent for bankers to grasp the technology practices they should reinforce and changes they should make,&rdquo; the report read. Banks need to stay committed to innovation and continue to prioritize relationships to evolve with the changing times.
So what does the future of technology look like? Respondents cited <a href="https://www.mx.com/guides/risks-rewards-ai/">artificial intelligence</a> (AI), Banking as a Service (BaaS), and faster payments as the top 3 trends that represent the most opportunity for their bank in the next 5 to 10 years. And, AI is by far the frontrunner &mdash;&nbsp;71% put AI in the top three while only 35% said BaaS.&nbsp;
Interestingly, open banking was mostly considered a risk by respondents. But, that may come down to the word &ldquo;regulation&rdquo; included in the question. Forty-three percent placed open banking regulation in the top 3 risks for their bank versus just 11% who said it was an opportunity. According to the report, &ldquo;...respondents likely dread compliance. Open banking also poses an opportunity, but with regulatory pressure, it may not feel that way.&rdquo;
<h2>&nbsp;What&rsquo;s Next for Open Banking</h2>
Open banking strategies across U.S. banks and credit unions face one of the biggest regulatory changes in years for the financial industry. The final <a href="https://www.mx.com/open-banking-made-easier/">Section 1033</a> rule is due to drop at any moment. It will create more clarity around consumer data rights and standardize the use of consumer-permissioned financial data, which creates an even greater need for a comprehensive technology strategy surrounding data. The report shows that most financial institutions are exercising caution in their methods. A small fraction (16%) say they are committed to providing open data access to third parties while 50% say they are interested in working with select third-party partners. Another 9% say they are waiting for regulations to be published.&nbsp;
But, according to the report, &ldquo;soon, banks won&rsquo;t have a choice about open banking. Those who have no strategy must move quickly to develop one.&rdquo; Open banking is here to stay &mdash;&nbsp;and can bring significant opportunities to unlock the power of data to create better experiences for consumers. The time is now to start building an open banking strategy and getting ready for 1033.&nbsp;
<h2>Is AI Hype Leveling Off?</h2>
While AI was the top area most respondents called out as an area of opportunity, the report also shows interest in leveraging AI tools has pulled back slightly from last year. The percentage of respondents who were &ldquo;very interested&rdquo; fell from 57% to 42%, while those &ldquo;somewhat interested&rdquo; rose from 19% to 28%.&nbsp;
That said, 21% also say they are already leveraging AI tools. As we look ahead, there are tremendous opportunities with AI but also risks to consider. The report says, &ldquo;advances in AI, meanwhile, and its reach into banking applications introduce potential risk and compliance issues in addition to substantial opportunities. Bankers are aware of risks and risk mitigation related to vendor management. But at this stage, few likely have a firm idea of what specific AI-related risks are.&rdquo;
At MX, we believe across all of the risks and rewards that AI can bring, it starts with being able to utilize consumer-permissioned financial data and business intelligence to mitigate the risks and maximize the opportunities. As financial services companies embrace AI for a multitude of use cases, they must also become a truly data-driven organization.&nbsp;
<h2>Conclusion</h2>
Across CCG Catalyst&rsquo;s findings, a common trend was that industry professionals should be &mdash; and are &mdash; cautious today, especially when it comes to new technology. The report closes with one solid piece of advice to combat the uncertainties of today&rsquo;s banking environment. &ldquo;Study new business models and technologies carefully before pursuing them, build your organization to execute successfully on innovation strategies, and set appropriate guardrails.&rdquo; We&rsquo;ll add one more to this &mdash; focus on how you are connecting to, enhancing, and leveraging data to drive more value from these new technologies.

Balancing Caution Across Today’s Banking Trends

Check out these key highlights from MX's webinar on what to expect from and how to prepare for the changes of section 1003. 

Have questions or want to know more? Schedule a strategy session to continue the 1033 conversation with us and gain access to additional resources to help you prepare for the final rule. 

The final ruling of Section 1033 is almost here, which means that financial providers need to prepare themselves and their data to meet new standards.

An Expert-Led Conversation on Why Section 1033 Matters

We expect the <a href="https://www.consumerfinance.gov/" target="_blank" rel="noopener">Consumer Financial Protection Bureau (CFPB)</a> to publish its final rule under <a href="https://www.mx.com/blog/cfpb-nprm-dodd-frank-section-1033/#what-is-1033" target="_blank" rel="noopener">Section 1033 of the Dodd-Frank Act</a> later this month. Leading up to this MX recently hosted a live conversation to share insights into what we know about and expect from the final rule.&nbsp;
Here&rsquo;s a few key takeaways from the discussion between Jane Barratt, MX&rsquo;s Chief Advocacy Officer and Head of Public Policy, and Ashwin Vasan, partner at FS Vector and former CFPB employee.
<h2>Fostering Competition</h2>
According to Ashwin, the &ldquo;North Star&rdquo; of Section 1033 was to foster competition &mdash;&nbsp;all in an effort to drive better outcomes for consumers.&nbsp;
Simply put, competition is the best way to ensure consumers benefit from their financial data. This rule is designed to foster competition so that consumers receive the best use from, service for, and benefit of their financial data.&nbsp;
<h2>Secondary Use Cases and Third-Party Risk</h2>
Some of the most challenging and complex parts of the upcoming 1033 rule include <a href="https://www.mx.com/whitepapers/secondary-use-cases/">secondary use cases</a> and third-party risk. Ashwin noted an underlying tension around risk in the impending rule &mdash; that between the consumer and the data provider.&nbsp;
The heart of the rule is that consumers have the right to access and use their financial data, but data providers are obligated to manage risk regarding the data in their possession.&nbsp;
This has raised some concerns across the industry as the proposed rule indicates consumers have the right to authorize a third party to access their data, but it is up to the financial provider to assess the risk of that access. We expect that the final rule may shed more light on this and will continue to evolve.&nbsp;
<h2>Open Banking as a Channel</h2>
In the end, both Ashwin and Jane see the future of <a href="https://www.mx.com/blog/what-is-open-banking/" target="_blank" rel="noopener">open banking</a> in the same way. This final rule is a first step towards the channel that open banking can become. Data providers should&nbsp; take this chance to make that first step a good one &ndash; to strive towards a better future that empowers better outcomes for consumers and the financial providers who serve them.&nbsp;
<h2>What&rsquo;s Next</h2>
The final 1033 rule from the CFPB is far from the end of the story. There are many other types of financial data that will not be covered in this initial rule making but those covered data types are coming. Data providers who get ahead on ensuring other financial account types meet expected obligations will be well-positioned to optimize their future.&nbsp;
If you were not able to tune in live, <a href="https://www.mx.com/webinars/road-to-1033/" target="_self">catch the replay</a> to hear more from our panel of policy experts and product leaders.

Coming Soon: Section 1033 Obligations and Opportunities

The UN celebrated the work of Queen Máxima towards financial inclusion and committed to going beyond inclusion to financial health

Queen Máxima has made great strides in extending financial inclusion around the world and now wants to go beyond inclusion to global financial health.

UN Celebrates Queen Máxima’s Work on Global Financial Inclusion

On Wednesday September 25, the United Nations held a special session to celebrate the work of Queen M&aacute;xima of the Netherlands to foster global financial inclusion.&nbsp;
Fifteen years ago, Queen M&aacute;xima was appointed as the UN Secretary-General's Special Advocate for Inclusive Finance. She has since worked with world leaders and traveled the globe in an effort to find ways to bring financial services to more people living in the developing world.&nbsp;
Last week&rsquo;s special session gathered world leaders, industry experts, and global citizens to acknowledge the amazing progress made towards this goal, but also to recognize the work still to be done.&nbsp;
<h2>Going Beyond Financial Inclusion</h2>
Throughout the encouraging and informative speeches given by everyone from Bill Gates to Queen M&aacute;xima herself, the message was clear: great strides have been made towards global financial inclusion, but we need to set our sights beyond mere inclusion. Nearly everyone who spoke touched on the idea that inclusion is a needed first step, but our goal should be global <a href="https://www.mx.com/use-cases/financial-wellness/">financial health</a>. This message was underpinned when Queen M&aacute;xima&rsquo;s new UN title was revealed &mdash; United Nations Secretary-General's Special Advocate for Financial Health.
The added focus on financial health did not overshadow the necessity of inclusion nor the accomplishments made toward that goal. In 2011, only <a href="https://www.weforum.org/agenda/2022/07/global-digital-financial-inclusion-findex/#:~:text=In%20developing%20countries%2C%20the%20unbanked,to%20be%20another%20major%20factor.">51% of the global population</a> had access to a financial account or services. That number has risen to 76% today. Over the last 15 years, Queen M&aacute;xima and her team have leveraged the connective power of cell phones and the internet to bring financial services to remote and impoverished communities around the world. However, she was the first to say the work is not finished. There are still an estimated 1.5 billion adults globally who remain unbanked.&nbsp;
<h2>Reaching the Unbanked</h2>
<a href="https://www.worldbank.org/en/home">World Bank&rsquo;s</a> president Ajay Banga, gave his insights into how to not only resolve the global unbanked population crisis, but also improve the financial health of those who have access to financial services. He broke the problem down into four steps: identification, access, use, and history.&nbsp;
<ul>
<li style="font-weight: 400;" aria-level="1">Identification: Without a formal government-issued ID, individuals are barred from access to many things, one of the most important being financial services. In fact, according to Bill Gates, 3.3 billion people globally do not have formal IDs.&nbsp;</li>
<li style="font-weight: 400;" aria-level="1">Access: While advances in digital banking have begun to bridge the gap, this still remains a fundamental aspect of financial health.</li>
<li style="font-weight: 400;" aria-level="1">Use: Value only follows access when people use the services they have access too. Unfortunately, this is not always the case &mdash; half of those in the developing world who have access to banking services do not use them.&nbsp;</li>
<li style="font-weight: 400;" aria-level="1">History: Once people have access to and use&nbsp; basic financial services, they build a financial history. This leads to being offered additional financial services such as loans.</li>
</ul>
Through Banga&rsquo;s perspective, the road map for fintechs and financial providers to capitalize on the opportunity to serve a more global population becomes clear. Queen M&aacute;xima expressed her intention to work with industry leaders to make providing financial services globally both easier and more profitable.&nbsp;
<h2>Leveraging Open Banking and AI</h2>
Jennifer Tescher, founder and CEO of the <a href="https://finhealthnetwork.org/">Financial Health Network</a>, added to this idea as she spoke in a closing panel on how to improve financial health around the world. In looking to the future, she equated the importance of smart phones and the internet over the last 20 years to what open banking and artificial intelligence (AI) will mean for the industry during the next 20 years.&nbsp;
As fintechs and financial providers adopt and hone the use of <a href="https://www.mx.com/open-finance/">open banking</a> and AI, they should look to the global market and how advancements in tech could serve a broader global population. Jennifer said, &ldquo;Open banking gives both the consumer and the provider the full picture of the person&rsquo;s financial life. It is really hard to give good advice if you are only seeing a sliver of the picture.&rdquo;&nbsp;
<blockquote>
&ldquo;If we want to contribute to the financial health of people and society we need to change our products in a way that fits people&rsquo;s complex financial lives.&rdquo; &mdash;Queen M&aacute;xima
</blockquote>

Turning Inclusion into Financial Health

Consumers are wary of trusting AI  in general, but  are warming to AI adoption in certain use cases in financial services. 

Consumers trust AI to help them with certain financial functions but are still wary of AI integration into financial services on the whole.

Consumers Trust in AI Integration in Financial Services Is Shifting

As financial providers embrace artificial intelligence to drive new efficiencies and innovation, our latest consumer research shows a general sense that consumers are not fully ready to trust AI. We asked <a href="https://www.mx.com/research/the-missing-link/">1,000+ consumers</a> about using AI to help them manage finances.&nbsp; While many consumers still distrust AI generally, our survey paints a more nuanced picture
On the whole, our research shows that 43% of consumers would not trust AI to help them manage and track their finances. However, the story changed when we broke apart the larger concept of &ldquo;managing and tracking finances&rdquo;, and asked about specific use cases. Many consumers expressed a willingness to trust AI to help them perform certain finance-related tasks.
Here&rsquo;s how the results break down:&nbsp;
Most Consumers Trust AI for Automated Reminders and Insights&nbsp;
<ul>
<li style="font-weight: 400;" aria-level="1">59% trust AI to deliver proactive reminders to pay bills, save money, etc.&nbsp;</li>
<li style="font-weight: 400;" aria-level="1">57% trust AI to provide a comprehensive breakdown of how they spend money</li>
<li style="font-weight: 400;" aria-level="1">51% trust AI to personalized recommendations on where you can make changes to improve finances</li>
</ul>
Consumers Not Fully Ready to Give Up Human Interactions for Support, Investments, Loans, or Advice
<ul>
<li style="font-weight: 400;" aria-level="1">51% trust AI to provide customer support when you need assistance</li>
<li style="font-weight: 400;" aria-level="1">50% trust AI to automatic savings options, such as rounding up to the nearest dollar on purchases and depositing in savings</li>
<li style="font-weight: 400;" aria-level="1">46% trust AI to provide basic financial advice, such as how much to put in savings or pay towards debt</li>
<li style="font-weight: 400;" aria-level="1">42% trust AI to categorize transactions to help understand where money is going</li>
<li style="font-weight: 400;" aria-level="1">42% trust AI to process a loan or credit application based on their financial data, including setting credit limits or approving/denying a loan</li>
<li style="font-weight: 400;" aria-level="1">39% trust AI to provide investment-related financial advice, such as stocks to purchase, retirement planning, etc.&nbsp;</li>
</ul>
All told, our latest research report shows that while consumers are not ready to hand the keys to their financial lives over to <a href="https://en.wikipedia.org/wiki/Skynet_(Terminator)">Skynet</a>, they are ready for AI&rsquo;s help in certain financial jobs-to-be-done.
 Read more in our<a href="https://www.mx.com/research/the-missing-link/"> latest research report</a> about consumers' feelings on AI in financial services as well as other insights into mobile banking, connectivity, and more.

Are Consumers Ready to Trust AI?

A good mobile banking experiences is crucial to attracting and maintaining customers in financial services.

Consumers expect a good mobile banking experience and are willing to look elsewhere If they don't get it.

A Good Mobile Banking Is Top of Mind for Most Consumers

Everywhere you go, people are attached to their phones. Nose to the screen, blue light reflected in their eyes. So, it&rsquo;s no surprise that our latest research shows nearly half of consumers have 3 or more finance-related mobile apps on their phones today. And, they are using these apps a lot. In fact, 31% of U.S. consumers say they log into the mobile banking or finance app they use most often every single day. An additional 22% say they log in multiple times a day.&nbsp;
However, not all mobile banking experiences are equal and no one is more aware of this than consumers. In fact,&nbsp; the quality of a mobile banking experience can be the deciding factor in the financial provider(s) consumers choose.
In our latest survey, we asked <a href="https://www.mx.com/research/the-missing-link/">1,000+ U.S. consumers</a> how likely they are to use a financial provider with a poorly-rated mobile app or bad mobile experience. Thirty-five percent said not likely and 22% said very unlikely. That means over half (57%) of consumers will shy away from using a financial provider with a bad mobile experience.&nbsp;
At the same time,&nbsp; 65% of consumers said they would stop using a mobile app if the experience changed for the worse.
This research makes it&nbsp; clear how important a good mobile experience is to consumers. But what makes a mobile banking experience good? Our research shows that consumers want a relevant and personalized experience.
Check out our<a href="https://www.mx.com/research/the-missing-link/"> latest research report</a> to learn more about what consumers want in their mobile banking experience and other actionable intel.

Mobile Matters: Consumers Expect a Good Mobile Banking Experience 

The financial data economy is undergoing significant changes with the CFPB’s final ruling of Section 1033.                        

The evolution of the financial data economy gives financial providers a unique opportunity to drive more value for consumers.

Driving Value Creation from Consumer-Permissioned Data

The financial data economy has remained largely untouched by strict regulations over the past decades. There were minimal requirements for how data brokers (those who collect, organize, and sell personal data to third parties) could use consumer data &mdash; which created severe consequences for consumers.
Those days are over. The biggest regulatory changes to digital financial data is on the horizon with the <a href="https://www.mx.com/open-banking-made-easier/">CFPB&rsquo;s final ruling of Section 1033</a>. Businesses across the industry will need to adapt &mdash;&nbsp;or face the risk of becoming irrelevant.&nbsp;
As Alex Johnson said in his latest installment of <a href="https://fintechtakes.com/articles/2024-09-18/the-future-of-the-financial-data-economy/">Fintech Takes</a>, &ldquo;banks, credit unions, and fintech companies need to prepare to compete and win in a very different environment than they are used to.&rdquo;
In case you missed it, here are some of the key highlights from this Sponsored Deep Dive on&nbsp; <a href="https://fintechtakes.com/articles/2024-09-18/the-future-of-the-financial-data-economy/">​​The Future of the Financial Data Economy</a>.
<h2>Financial Data is Key</h2>
Consumers and the financial industry can greatly benefit from the proper use of consumer-permissioned financial data. Consumers gain greater insights into their finances while consumer-permissioned data can help businesses deliver more personalized experiences and tailor their products to the consumer.&nbsp;
&ldquo;Financial data generated by consumers belongs to consumers, and they should be allowed to share it with any company that they want in pursuit of better financial products, experiences, and outcomes.&rdquo;
<h2>Setting New Standards for Data Sharing</h2>
The history of financial data sharing has had its low points. Johnson says, &ldquo;it was not always clear to the consumer who had their data, how long they would have it, or precisely what they were doing with it.&rdquo; But that can and should change. The CFPB&rsquo;s Section 1033 rule will serve as a catalyst for how companies leverage consumer-permissioned financial data to develop more innovative products and services and compete more effectively for the most valuable customers.
It&rsquo;s the difference between a well-structured highway system versus driving on fury road like Mad Max. Instead of being chaotic and messy, the road is governed by a common set of rules and standards, not who has the biggest car. &ldquo;There are designated on-ramps (for consumers&rsquo; granting permission), exits (for consumers to revoke access), and traffic lanes (for consumers to control which third parties see which data). And safety (via APIs instead of screen scraping) and fuel efficiency (data minimization) are paramount.&rdquo;&nbsp;
<h2>Transform Data into Insights</h2>
Financial institutions find themselves at a crossroads where they can either adapt to new technology that will allow them to use data for the delight of their customers, or find themselves stuck behind the competition.&nbsp;
This isn&rsquo;t just about meeting compliance obligations. It&rsquo;s about delivering value to consumers.&nbsp;
&ldquo;Are you building compelling reasons for consumers to share their data with you into the context of your products? Put more simply, what do your customers get out of sharing their data with you?&rdquo;
Financial services providers should focus on how they can transform data into <a href="https://www.mx.com/products/financial-insights/">insights</a> that will ultimately benefit the consumer.
Be sure to read the full <a href="https://fintechtakes.com/articles/2024-09-18/the-future-of-the-financial-data-economy/">Sponsored Deep Dive</a> for Alex&rsquo;s full take on the financial data economy.&nbsp;

From Value Extraction to Value Creation: The Future of the Financial Data Economy

Consumers want connectivity, but many haven't adopted it yet. Where are consumers missing a step in utilizing connectivity? 

Consumers are not always aware connectivity is available, but they want it. See how our latest research report highlights this and how to fix it. 

Research Uncovers Connectivity Gap to Solve for Consumers

Managing personal finances has become more and more complicated as consumers have more and more financial accounts. As the complexity of a consumer&rsquo;s financial life rises, so does the desire for a solution that can bring all of those accounts back into one view.&nbsp;
In fact, 57% of consumers <a href="https://www.mx.com/research/the-missing-link/" target="_self">in our latest survey</a> said they would pull together all of their finances into a single mobile app to make them easier to track and manage if they had the option. The reality is &mdash;&nbsp;they probably do have this option. And, they are probably connecting accounts but not realizing what it could mean for them.&nbsp;
The <a href="https://financialdataexchange.org/FDX/News/Press-Releases/Financial_Data_Exchange__FDX__Reports_76_Million_Consumers_Use_FDX_API.aspx">Financial Data Exchange (FDX) reported</a> in March that 76 million consumer accounts are now actively utilizing its FDX API for secure open finance data sharing. And, this is just those using the FDX API! That means millions of consumers are connecting accounts somewhere. So where are consumers missing a step?&nbsp;
Financial services providers need to better educate consumers about <a href="https://www.mx.com/guides/everything-to-know-about-connectivity/">the value of connectivity</a>. It&rsquo;s not just for a one-time action like funding a new account or sharing data when applying for a loan: continuous connectivity has immense value. With a more complete picture of their finances gained from connecting their accounts, consumers can better understand, track, and manage their finances; helping them to become financially stronger and reach their financial goals.&nbsp;
Beyond educating consumers on the valuable outcomes they can gain from connecting their accounts, financial services providers should also focus on delivering connectivity experiences that meet consumer needs and expectations.&nbsp;
According to <a href="https://www.mx.com/research/the-missing-link/" target="_blank" rel="noopener">our survey</a>, consumers want connectivity that is secure and easy to use. When asked what is the most important factor in bringing together all their financial accounts in a single app, 43% of consumers ranked being able to do so easily as number one. Other top factors include knowing their financial data is safe and secure (31%) and the ability to control and manage who has access to their financial data (14%).&nbsp;
At the end of the day, consumers want help with their finances &mdash;&nbsp;and it starts with connected, data-driven experiences.&nbsp;
Check out the <a href="https://www.mx.com/research/the-missing-link/">full consumer research report</a> to learn more about what consumers want from a connectivity experience and more.

Are Consumers Missing a Step? Fixing the Connectivity Gap 

Our latest research shows some surprising trends in consumer spending on summer entertainment. 

MX research shows U.S. adults are spending less overall on vacation and travel this summer as the economy combats “funflation.”

U.S. Consumer Summer Spending Habits 

With summer, comes more travel, summer camps, and fun in the sun. However, most often, that fun comes with a price tag, and never has this been more true than in recent years. This is in part due to summer &ldquo;funflation&rdquo; &mdash;&nbsp;a term economists use to explain the increasing price tags of live events after the forced lull in travel and entertainment caused by the COVID-19 pandemic.&nbsp;
As summer comes to a close, we asked consumers to share how funflation has impacted their summer spending habits. While <a href="https://www.cnbc.com/2024/06/26/funflation-why-consumers-are-spending-so-much-this-summer.html">CNBC reported</a> that 38% of adults were planning on taking on more debt to travel, dine out, and see live entertainment in the summer months, our <a href="https://www.mx.com/research/the-missing-link/">latest survey of 1,000+ U.S. consumers</a> showed something different.&nbsp;
In fact, <a href="https://www.mx.com/research/the-missing-link/">58% of U.S. adults</a> surveyed said they are spending less on vacation and travel this summer compared to last year in order to save money. Older generations reported being even more conservative &mdash; 59% of Gen Xers and 68% Baby Boomers said they were spending less this summer.&nbsp;
And, for those who are spending more, the majority are planning ahead. Sixty-two percent of respondents said they save money throughout the year to accommodate higher expenses during the summer.&nbsp;
On the flip side, our research shows one area where people aren&rsquo;t cutting expenses: their kids. Only 13% of U.S. adults say their children are participating in fewer summer activities than last year in order to save money. Instead, nearly 1 in 4 (24%) are spending more on summer activities for their children than last year.&nbsp;
To read more about how consumers spent this summer, <a href="https://www.mx.com/research/the-missing-link/">take a look at the full research report</a>, which also takes a deeper dive in connectivity and mobile experiences.&nbsp;

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