The CFPB’s Data Sharing Principles

In October, the Consumer Financial Protection Bureau (CFPB) released “Consumer Protection Principles: Consumer-Authorized Financial Data Sharing and Aggregation.” These principles acknowledge the growth and promise of tools that, with user permission, access and use data from users’ financial accounts. They also outline the Bureau’s understanding of the consumer interests and needs at stake in the growing market for these tools.

Commonwealth believes that these new principles provide valuable guidance on how to responsibly develop and manage user-authorized data sharing, and that this technology can facilitate the creation and use of innovative tools that help people manage their financial lives and build financial security.

Commonwealth’s SavingsQuest provides an example of how user-permissioned data sharing can be designed in alignment with the CFPB’s principles and can enable financially vulnerable people to build financial security. SavingsQuest is an app that uses gamification to motivate and encourage small-dollar saving. SavingsQuest works by linking the app to a user’s live financial account using secure application programming interfaces (APIs). SavingsQuest relies on user-authorized access to data to track account balances and activity, and to move funds from a spending account into a savings account.

Through the development of SavingsQuest, we learned some key lessons for responsible data-sharing that are reflected in the CFPB’s principles. These lessons include:

  • accessing the minimum necessary consumer data to serve a given purpose;
  • leveraging account authentication methods that minimize exposure of credentials to third parties;
  • making clear to the consumer in simple and plain language what data is being shared and for what purpose;
  • and making it easy to revoke permission at any time or opt out of sharing altogether.

If developed and managed with consumer interests in mind, technology-driven platforms and tools have the potential to serve the needs of financially vulnerable people and to advance a more inclusive financial system. Commonwealth applauds the CFPB for providing clear guidance to relevant stakeholders to ensure that data sharing and aggregation technology can fulfill their potential to deliver innovative financial tools in a secure and consumer-friendly way.

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