Tch Model Data Access Agreement

It is also another important step for TCH`s Connected Banking initiative, which aims to facilitate customer innovation and control and secure exchange of banking data. One area that was particularly sensitive was which party is responsible in the event of an infringement. The new model agreement requires data recipients to cooperate with banks on cyber risks and reimburse lenders for all costs associated with an infringement that occurred under their control. As a “common basis,” the model is expected to be seen as a starting point to facilitate data access agreements between banks and fintech and to reduce the need to negotiate the same terms with each agreement. Lenders have been working on ways to share data to end a practice known as screen scraping, where consumers often have to provide their usernames and passwords to share financial data with external applications. Banks such as JPMorgan Chase and Co. and Capital One Financial Corp. oppose the scraping process and say it gives consumers little control over how much data is collected and how it is used. “APIs have the potential to significantly use consumers, but the long process of reaching an agreement can become a bottleneck in the introduction of the API,” Hunter said. “Using the agreement model as a benchmark to facilitate API agreements can streamline and accelerate the introduction of API technology.” In its current version, TCH`s proposal would allow banks – not customers – to decide what data they can share, what applications they can use, and how customers can use their own data when they choose to use it.

Banks could prevent customers from using applications that are more competitive or more responsive to their needs and applications. For example, a bank might discourage its account holders from buying a transaction for a better mortgage or a credit for small businesses. To view the chord template and provide feedback, visit www.theclearinghouse.org/connected-banking/model-agreement. Kabbage and Plaid support simple and consistent rules for data exchange. Plaid helps consumers connect their bank accounts to the apps they want to use and ensures that consumers have the choice and control they want is a fundamental principle for us. Although TCH argues that its proposed agreement would strengthen consumer control over their own financial data and encourage innovation, it would in fact have the opposite effect.