The Competition and Markets Authority (CMA) has launched a consultation on the effective oversight and governance of open banking.
The CMA said it will evaluate all proposals submitted, including those from trade body UK Finance, against four criteria for an open banking framework.
These four criteria mandate that the framework is independently-led and accountable, adequately resourced to perform the functions required, dedicated to serving the interests of consumers and small- and medium-sized enterprises and sustainable and adaptable to the future needs of the ecosystem.
The consultation closes at 5pm on 29 March.
Earlier this month UK Finance set out plans to create a not-for-profit service company, labelled the future entity, to replace the Open Banking Implementation Entity (OBIE) as it hopes to expand the use of the technology.
Imran Gulamhuseinwala, trustee of Open Banking Implementation Entity (OBIE) welcomed the CMA’s consultation.
He said that open banking enabled products currently have three million users with one million new users of open banking every six months and growing innovation in areas such as payments.
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“As OBIE comes to the end of the implementation phase, we look forward to working with the CMA, who will set out the next steps and we encourage any external stakeholders to contribute to the consultation,” said Gulamhuseinwala.
“A regular appraisal of the progress of open banking implementation is crucial to ensure a healthy ecosystem and competitive market.
“Open banking has been critical to supporting the UK’s emerging and growing fintech industry. We have pioneered the technology and as the government said only last week, it is now taking the world by storm.
“As we look beyond to open finance and smart data, it is terrific to see a clear recommendation from the Kalifa Review supporting the concept of a similar mandated body to oversee its implementation. It will be beneficial to UK fintech, but most importantly to consumers and small businesses.”
Meanwhile, the OBIE and the European Third Party Providers Association have signed a mutual cooperation agreement to strengthen their interaction, establish a framework to share information and work to help accelerate the open finance journey.
The agreement focuses on providing guidance and clarification on the operational aspects of Payment Services Directive (PSD2), the legislation that underpins open banking in Europe.
Both organisations will work together on activities relating to third party provider services under PSD2 open banking. This comprises research, statements, documents and webinars, as well as outreach to other organisations within the open banking ecosystem.