On August 22, 2018, The Clearing House issued a report concerning fintech apps and data privacy. The report notes how fintech apps have experienced a rapid rise in popularity in recent years, in large part because they provide solutions “designed to be simple, fast and accessible via smartphones and tablets,” but that they also pose certain data privacy risks. To better understand consumer perceptions and awareness of third-party personal and financial data collection, The Clearing House conducted a survey of more than 2,000 U.S. banking consumers and oversampled to reach 1,500 fintech users in the first quarter of this year.
Key findings from the survey include:
According to The Clearing House, these findings “underscore the need for collaborative action to ensure that the personal and financial information accessed by third parties is being handled securely and consumers’ expectations for data security are being met. The financial services ecosystem is built on trust between consumers and companies; failure to live up to consumers’ expectations and keep their information safe puts that trust at risk. There is a need for a concerted effort by all stakeholders— including banks, fintechs, data aggregators, regulators, and consumers—to ensure data security.”
The report provides the following three recommendations:
“As consumers are increasingly using fintech apps, we need to make sure their financial information is being accessed safely. Banks and fintechs need to work together to develop more secure methods for consumer-controlled data sharing,” stated Dave Fortney, executive vice president, product development and management, at The Clearing House.
The Clearing House is currently collaborating with banks, regulators, fintech app providers and technology companies on the topics of secure financial data sharing, controls and data privacy. Later this year, The Clearing House will announce additional steps intended to promote the safety, security and transparency of consumer data sharing.