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Fintech associations argue that the Financial Data Access (FiDA) framework will unlock meaningful consumer benefits and new business opportunities, while cautioning that delays or scope reductions would hinder Europe’s competitiveness.
In a joint statement addressed to EU ambassadors ahead of trilogue negotiations, more than 20 industry groups called for the preservation of FiDA’s original ambition, as outlined by the European Commission.
The signatories argued that the framework is essential for delivering an open finance ecosystem in which individuals and businesses can access, share and reuse their financial data securely and efficiently across payment, savings, investment, insurance and pension services.
The industry letter warns against efforts to narrow the scope of the proposal or exclude large corporate entities, arguing that such changes would fragment the single market and reverse progress made since the second Payment Services Directive (PSD2).
The associations maintain that Europe’s competitiveness depends on enabling a vibrant open finance ecosystem and allowing both consumers and firms to benefit from secure, permission-based data portability.
“If this continues, it risks becoming another huge waste of time and money for everyone involved, just like PSD2. History is repeating itself,” said Ralf Ohlhausen, chair of the European Third Party Providers Association (ETPPA).
Unlocking the potential of open finance
The ETPPA was a signatory, alongside several major trade bodies representing fintechs and digital finance providers across the EU, including the European Digital Finance Association (EDFA), the Electronic Money Association (EMA), France FinTech, Holland FinTech, FinTech Poland and the Swedish FinTech Association.
Together, these groups represent thousands of firms across payments, lending, insurance and wealth management.
“There’s a lot more value for consumers in sharing data across different parts of financial services, far more than what open banking alone can offer,” said Martin J. Gylfe, CEO and co-founder of Insurely.
Gylfe told Vixio that with open banking, there are a few useful things with transaction data, such as credit scoring or know-your-customer (KYC), but he pointed out that the use cases are relatively limited.
“It’s not going to revolutionise your life. We saw that with PSD2, lots of budgeting tools emerged, but it’s proven hard to build profitable use cases like that,” he said. “Open finance, on the other hand, unlocks much more potential.”
Gylfe highlighted areas such as pensions, loans, savings accounts and investments that offer meaningful use cases for consumers.
“It can help people optimise their financial portfolios, and for advisers or decision-makers, it’s incredibly valuable to see all assets and liabilities in one place,” he said.
A vital framework
Open finance could also extend the revenue opportunities of many European start-ups in the fintech space.
For example, for fintechs already operating under open banking as account information service providers (AISPs) or payment initiation service providers (PISPs), the shift to open finance under FiDA would significantly broaden their opportunities.
It would extend the legal framework for data access, which could support new use cases such as holistic financial dashboards, personalised investment or insurance recommendations and seamless product switching.
By opening up a wider range of customer data, open finance would allow these fintechs to deepen engagement, create more value-added services and compete more effectively with incumbents across the full spectrum of financial products. This is something not yet realised under the open banking framework.
“Personal finance management will evolve dramatically with open finance, and it will also make switching between financial service providers much easier. These are exactly the kinds of questions consumers struggle with today,” Gylfe told Vixio.
FiDA “will help the industry scale faster and boost competition, absolutely. It empowers consumers to make better choices,” he added.
“It might sound counter-intuitive, but having a common framework actually makes the market safer. People are willing to share data if they get better products and more understanding in return, regardless if there is a regulation or not.”
Gylfe also warned that without a framework, there are no guardrails. “It’s a bit of a wild west right now, where unlicensed players can easily sell data to anyone interested, including big tech firms. Regulation will make open finance more trusted, transparent, and secure.”
Ensuring global competitiveness
The fintech community’s statement comes in response to pushback from parts of the banking industry, which have cited security and compliance challenges as reasons to slow down the initiative.
The trade associations argue that such risks can be mitigated through strong technical and regulatory safeguards, and that delaying FiDA would entrench incumbent advantages while stifling innovation.
“Everyone wants FiDA simplified, but the real question is how. Banks and insurers want simplification by reducing the scope, and that excludes large parts of the industry and corporate data,” said the ETPPA’s Ohlhausen.
“Essentially, they want to cut down the framework so much that several sectors of the financial industry are taken out, and some would rather see the whole thing scrapped altogether. Among banking and insurance associations, there’s a clear message and that is that many would prefer FiDA to be killed entirely.”
The letter concludes that FiDA is vital to ensuring Europe remains globally competitive in digital finance, supports the wider EU objectives such as the Savings and Investment Union and empowers consumers to make better financial decisions.
The signatories urge policymakers to use the current trilogues to refine and strengthen the framework rather than scale it back, positioning Europe as a leader in open finance.
FiDA, first proposed by the European Commission in June 2023, has progressed steadily through the EU legislative process so far, moving quicker than other legislation such as that related to the digital euro.
The Council reached a general approach in December 2024, paving the way for negotiations with the European Parliament, and despite rumours that the regulation would be withdrawn, trilogue discussions are now underway.
Outstanding points of debate include the scope of data to be shared, treatment of corporate clients, and governance of data-sharing schemes.
