FCA to explore big tech opportunities for insurance industry

FCA chief executive Nikhil Rathi has revealed the regulator’s plans to look at how big tech firms’ datasets could create more opportunities across the financial services and insurance sectors.

In a speech at the Digital Regulation Cooperation Forum (DRCF) event yesterday (22 April 2024), Rathi said such data could unlock better products, more competitive prices and wider choice for consumers and businesses.

Currently, big tech firms can access financial services data through open banking, but are not required to share their data with the financial industry.

However, if the FCA’s analysis finds big tech data is valuable in financial services, it will look to incentivise more data sharing between big tech and financial firms.

“Big tech’s growing emergence in financial services has already made life easier for consumers, but it is still unclear how valuable their data will become in financial markets,” Rathi said.

”That’s why we want to work with big tech to examine how their data could be most helpful for financial firms and their customers in future and to ensure competition evolves effectively.”

Call for input

This came after the FCA launched a call for input in November 2023.

This aimed to explore the asymmetry of data and data sharing mechanisms between big tech and financial services firms.

“While the respondents to our call for input did not identify any immediate harms from data asymmetry, we know we must remain vigilant,” Rathi said.

”We will continue to take proactive steps towards developing a regulatory approach to big tech’s activities in financial services.”

If the FCA finds potential risk or harms from non-sharing of data, it will also look to develop proposals for the Competition and Markets Authority (CMA) to consider when they are given powers to regulate designated firms’ digital and data conduct.