The Labour government has taken its second measure aiming to better leverage the power of data in the country’s economy, introducing the Data Use and Access Bill.
The Bill has three core areas, with the government’s overall objective being to leverage data across multiple use cases including public services, with the police and NHS given as the chief examples.
However, along with other legislative efforts, it will also have a lot of significance for the country’s finance and fintech sectors, particularly Open Banking. The Department of Science and Technology (SIT), which introduced the Bill, has highlighted growing the economy as one of the Bill’s three core goals.
Labour asserts that the Bill, if passed, could generate around £10bn towards the UK economy. This will partly be driven by creating what it calls ‘the right conditions’ to support Open Banking and grow smart data schemes so businesses and consumers can safely share information with regulated third parties.
Such data sharing is central to the functionality of Open Banking, which the UK has been pursuing a leadership position in under both the current Labour government and its Conservative predecessor.
Technology Secretary Peter Kyle said: “Data is the DNA of modern life and quietly drives every aspect of our society and economy without us even noticing – from our NHS treatments and social interactions to our business and banking transactions.
“It has the enormous potential to make our lives better, boosting our National Health Service, cutting costs when we shop, and saving us valuable time.
“With laws that help us to use data securely and effectively, this Bill will help us boost the UK’s economy, free up vital time for our front-line workers, and relieve people from unnecessary admin so that they can get on with their lives.”
Solving issues around interoperability is another area the Bill seeks to address. SIT anticipates its data sharing model to expand the potential of data sharing seen in Open Banking to sectors like energy, allowing the public to compare utility bills and find deals.
Interoperability has been highlighted as an important area for the government and financial services to address regarding Open Banking adoption. As with other aspects of Open Banking policy, it is an ambition Labour shares with its Tory Party rivals, having been highlighted by Conservative MP John Penrose at the Pay360 conference earlier this year.
During the General Election campaign, Labour was quick to match its Conservative counterparts in wanting to see greater Open Banking adoption, having made a pledge in its July manifesto.
Prior to the launch of the Data Use and Access Bill today, Labour had already sought to make good on its Open Banking promise with July’s Smart Data Bill, which aims to create Smart Data Schemes to facilitate the secure sharing of customer data with authorised third-party providers.
The policies come as various countries around the world look to boost their own Open Banking sectors. The Nordics are a traditional stronghold for the technology, but the likes of Australia, India and the US are also making inroads.
More recently, US regulators made their own move in Open Banking, introducing new rules around data sharing which could encourage greater customer engagement. Convincing consumers, who are often wary of excessive data sharing, to adopt Open Banking may be one of the biggest challenges it faces.
