Embracing Open Banking

Introduction

The 1033 Dodd-Frank Act has been a hot topic in the US financial industry ever since its announcement.  The Dodd-Frank Act is a comprehensive financial regulation law enacted in 2010 to increase oversight, transparency, and consumer protection in the U.S. economic system following the 2007-2008 financial crisis.  In October 2023, the Consumer Financial Protection Bureau (CFPB) proposed Section 1033 as part of the Dodd-Frank Act. This proposal, which is set to be implemented in late 2024, has sparked widespread discussion about its implications for financial institutions, third parties, and consumers.

There’s no doubt that this rule is set to propel open banking in the US to new heights and establish stronger financial rights. But before we dive into what Section 1033 entails and its impact on the various parties involved, it’s essential to understand the background of the financial industry in the US.

Banks vs Fintechs: Data vs Innovation

The current US financial industry is dominated by following major institutions: JP Morgan, Bank of America, Citi Bank, and Wells Fargo. In 2023, these four banks alone accounted for 45% of the total profit share among 4,400 banksAdditionally, they hold more than half (53.62%) of the total bank assets in the U.S. Read more

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