UK Authorities Issue Joint Statement on Future of Open Banking
The Competition and Markets Authority (CMA), the Financial Conduct Authority (FCA), Her Majesty’s Treasury (HMT), and the Payment Systems Regulator (PSR) have published a joint statement outlining their plans for oversight of a future open banking entity, including the establishment of a Joint Regulatory Oversight Committee. The joint statement outlines that the Joint Regulatory Oversight Committee will draw up proposals for the design of the future entity by the end of 2022.
CMA also published recommendations for the future oversight and governance of open banking. The recommendations will be taken into consideration in the design of the future entity to succeed the Open Banking Implementation Entity (OBIE). The future entity would build on the significant progress made to date by the OBIE to encourage innovation and support competition in retail banking. The CMA’s recommendations are that the future entity should:
- have effective regulatory oversight, with a new Joint Regulatory Oversight Committee to agree and implement the next steps led jointly by FCA and PSR
- have independent and accountable leadership, with a majority of independent directors on its Board
- have a clearly articulated purpose
- be adequately resourced to carry out its functions through a more broadly-based and sustainable funding model
- effectively serve the interests of consumers and small and medium sized businesses, including consideration for how these groups will be represented in the governance of the entity
- be sustainable and adaptable to the future needs of the sector
- have a system to effectively support the monitoring and enforcement of the Retail Banking Market Investigation Order 2017
CMA also published its response to the March 2021 consultation on the future oversight of open banking. The consultation sought views on the arrangements that should be put in place to ensure effective oversight and governance, following implementation of the remaining measures in the roadmap required under the CMA’s Order for Open Banking. Views are also sought on the way CMA should manage the transition process toward this new governance model.
- FCA Notification on Joint Statement
- HM Treasury Notification on Joint Statement
- CMA Recommendations
- Joint Statement
- CMA Consultation on Open Banking
Keywords: Europe, UK, Banking, Open Banking, CMA, PSR, OBIE, Regtech, FCA, HM Treasury
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