FERMA has submitted its Feedback to the European Commission on the Open Finance Framework (FIDA) enabling data sharing and third-party access in the financial sector – here– . This is an initiative under the EU digital finance strategy that aims at enabling data sharing and third-party access for a wide range of financial sectors and products, in line with data protection and consumer protection rules.
After consulting its members on the merits of the framework proposed by the Commission, FERMA developed a position paper that summarises the perspective of risk managements professionals, which you can read here.
FERMA is supportive of any policy intervention that leads to innovation in the (re)insurance sector and FIDA could represent the long-awaited innovation in the business-to-business (re)insurance market.
- On the objectives of FIDA
Risk managers are of the opinion that the framework for pooling data that FIDA establishes would be welcome if aggregated and anonymised datasets had some informational power for enterprises, allowing them to effectively benchmark and contextualise their contracted services.
- On the scope of FIDA
FERMA generally appreciates the scope in FIDA, but understands that two additional factors (on which clarification is requested) could further influence it: what the data holder permits to being shared and what is agreed upon as the content to be shared withing the Financial Data Sharing Schemes.
- On data access in FIDA
In the position paper drafted by FERMA, the two major areas of focus when it comes to data access in FIDA, are linked with the reassurance of corporate clients of the insurance industry that they could adequately control and permit access to the data they shared and with the access to data that would be useful for risk managers.
FERMA members have a real interest in ensuring a transparent and controlled environment in which appropriate safeguards would be in place. Therefore, a clearer definition of “confidential business data” and operational technicalities of the permissions dashboard in the B2B segment are welcomed.
Furthermore, the risk management community is also interested in knowing if FERMA would qualify as a “customer organisation”, if the Financial Data Sharing Schemes would be the only option and at which level these schemes would be formed.
To conclude, FERMA highlighted that the success of the mechanism introduced by FIDA is dependent on the quality, relevance and structure of the data that is shared. With the submission of this feedback FERMA intends to contribute to the development of a more adequate version of the proposal, that would suit the needs of the risk management community. FERMA looks forward to the outcomes of the initiative and remains available for further consultation.