PSD2 and GDPR: Opposition and Unity

The answer to this tension between openness and strengthening data protection lies in – giving ownership and control of data to the individual.

PSD2 and GDPR: Opposition and Unity

The answer to this tension between openness and strengthening data protection lies in – giving ownership and control of data to the individual.
fintech course By FINTECH Books Contributor, Nick Swanson Follow: @ObjectTech_Ltd  2017 and 2018 will see two of the biggest regulatory changes in finance and in the technology which underpins our modern system – but these two pieces of European legislation can in many ways seen to be at odds with one another.    PSD2 – the second Payments Services Directive – is a piece of European Law which effectively forces banks to open up their customer databases and allow third parties to use this data, and put it to work through new services, rather than it just sitting in a silo inside a bank. Comparison websites will be able to aggregate account information and advise users if they’d be better moving their money into a higher interest account for example. Social media platforms will be able to instruct payments from bank accounts, and online banking in general will cease being something which one does solely through clunky banking apps, but is instead delivered via an innovation-driven market. GDPR – the General Data Protection Regulation – updates 23-year-old privacy legislation, and potentially sits in opposition to many of the assumptions of how the payments and fintech market will develop with PSD2. One forces banks to open up their systems to third parties via APIs, the other imposes punitive financial sanctions for the misuse and mishandling of this data – €10,000,000 or 2% of global turnover. What emerges from this clash should be of interest to everyone in financial services, technology and consumers themselves. The answer to this tension between openness and strengthening data protection lies in– giving ownership and control of data to the individual, and helping them to safely and securely manage their online life: an open source system of transacting online which will revolutionise banking, finance and online commerce. If you would like to learn more about FinTech and please look at our video courses at FINTECHCircleInstitute.com