Washington, D.C. – The Bank Policy Institute, American Bankers Association, Consumer Bankers Association, and The Clearing House Association have jointly sent a letter to the Consumer Financial Protection Bureau (CFPB) urging the establishment of an appropriate timeline for compliance with the forthcoming rule governing consumer financial data under Section 1033.
The letter recommends that the initial tier of banks required to comply with the new rule be granted at least two years to develop necessary systems and processes. This period would also allow for a standard-setting organization to gain CFPB recognition.
“Banks spent years developing systems to enable safe data-sharing for 50 million customers and overhauling these systems to comply with this new rule will take time,” stated the Associations. “In the interest of protecting customer data and avoiding disruptions, it’s better to get it done right than to get it done quickly. Banks are committed to serving their customers and complying with the law, and we encourage the CFPB to recognize the complexities of the new requirements and establish pragmatic timelines that allow for a smooth implementation without disrupting consumer data access.”
The Associations highlighted several operational challenges in their letter:
- **Implementation Challenges**: Banks will need to upgrade technologies, standardize data, develop operational policies and procedures, build new functionalities, work with third-party partners, and refresh public-facing resources.
- **Coordination and Collaboration**: Existing agreements with third parties will need review and amendment to meet new obligations.
- **Standard-Setting Procedures**: The CFPB has recently finalized a rule establishing procedures for recognizing a standard-setting body. Developing consensus standards within such an organization is expected to be time-consuming.
Additionally, they recommended extending compliance deadlines for subsequent groups of entities by 18 months in line with CFPB’s proposed phased approach.
To access a copy of the letter, please click here.
The Bank Policy Institute is a nonpartisan public policy group representing universal banks, regional banks, and major foreign banks operating in the United States. It conducts academic research on regulatory topics and represents financial services concerning cybersecurity and other information security issues.
Austin Anton can be contacted at Bank Policy Institute via email at austin.anton@bpi.com.
Sarah Grano can be contacted at American Bankers Association via email at sgrano@aba.com.
Billy Reilly can be contacted at Consumer Bankers Association via email at breilly@consumerbankers.com.
Greg MacSweeney can be contacted at The Clearing House Association via email at gregory.macsweeney@theclearinghouse.org.