In October 2024, the Consumer Finance Protection Bureau (CFPB) released their long anticipated final ruling of what the financial industry has short-handed to “1033”. The new Personal Financial Data Rights rule, also referred to as Dodd-Frank Act 1033 Implementation, has been expected to reshape the financial market in the United States by giving consumers greater control over their financial data and implementing open banking data-sharing standards across all financial institutions (FIs).
At Ninth Wave, we’ve been working with FIs to deliver secure data provider and sharing standards to eliminate screen-scraping and improve customer experience for over a decade – long before any regulations proposed the idea. We fully recognize the value to financial institutions to create a competitive advantage through trust, security, and future-proofing their technology. We are all-in on the standards to eliminate screen-scraping. Regulatory requirements may come and go but consumer trust is something every financial institution should build their strategy around.
As open banking and data-sharing trends continue to grow globally, consumers are accustomed to the idea of securely sharing their financial data with third-party providers. Given that consumers are increasingly expecting more control over their financial data and greater transparency in how it is used, banks that proactively comply with the intention of 1033, regardless of their size or any regulation, can expect to build stronger relationships with their customers by delivering on these evolving expectations.
Open finance is an inevitability. Regardless of delays or changes in regulation, banks must respond to market demands for security, accessibility, and deliverability. By acting early, banks will have the opportunity to fine-tune their processes, invest in the right technology, and ensure future compliance without facing the immediate pressure of regulatory deadlines.
From Ninth Wave’s perspective, as a protocol-agnostic data platform collaborating across the open finance ecosystem—including aggregators, fintechs, third-party applications, and data providers—banks that embrace Open Banking now can secure a competitive advantage. This early adoption positions them for long-term ROI and success in an increasingly data-driven financial landscape.
We sat down with Cameron Taylor, Chief Product Officer at Ninth Wave, to get his insights on what’s happening with open banking as we close out 2024 and look ahead to 2025.
NW: Confusion over 2024 regulation has left some banks wondering whether they should proceed with their open banking plans. What have you been hearing from financial institutions and what do you tell them?
CT: The benefits of open banking – for financial institutions and their customers – are a competitive advantage and becoming more of a baseline market requirement. Banks shouldn’t need a government mandate to improve the user experience, data quality, information security, and customer satisfaction for their end-customers. As customers continue to navigate their increasingly complex financial lives, FIs that make it easier will rise in the market.
Enabling open banking is one of the reasons the big banks have gained market share of deposit accounts over the last 10 years — their customers value the improved user experience and security regarding the sharing of their data. In addition to all the benefits for end-customers, open banking also provides a tremendous value to the bank itself, with deep insights into what their customers are doing outside of the bank’s four walls.
Embracing open banking now is a benefit that any FI should be planning for. While there has been some confusion with evolving regulations, our position at Ninth Wave has always been to empower open finance with financial institutions at the center of the ecosystem, and our clients continue to benefit from their early actions.
NW: What are you expecting (or hoping) will change in Open Finance in 2025? What should the industry be planning for?
CT: There’s an opportunity here for the industry to continue leading on open banking and raise the bar for all data exchange. I expect we’ll see more information regarding standards-setting and details regarding how compliance will be measured and governed. FDX has played the primary role here to date and has provided much value to the industry by aligning data providers on a set of standards to move open banking forward in the US. With the broader adoption of standards, it will make having a single source of data, a single connection to manage all traffic, with visibility and analytics into all traffic, even more vital.
I’m also hoping that transactional activity and payments becomes part of the mandate somehow. This will certainly accelerate compliance since screen-scraping can’t do this, and banks will have to shift.
We get asked all the time why end-customers should switch to direct connectivity if they are already getting data from aggregators/screen-scraping. Aside from the obvious answers regarding security and user experience, transactional capabilities are a major factor — if payments are included, then screen-scraping falls out of favor and everything becomes more secure and integrated.
And finally, as customers appreciate the value for open banking for deposit accounts, I hope this accelerates the desire to also have investment/commercial accounts be part of the mandate as well.
Despite the regulatory uncertainties, the broader trends toward consumer empowerment, open banking, and innovation in financial services are unstoppable. Moving proactively will help banks future-proof their operations, build customer trust, and remain competitive in a rapidly changing marketplace.
In our connected world, financial data cannot be kept in silos. Financial institutions that don’t seamlessly integrate with others face the risk of becoming irrelevant. Responding to customer needs for accessible and secure connectivity positions your FI as the partner of choice for business customers and consumers – increasing acquisition, retention, and loyalty.
Ninth Wave not only aligns with CFPB’s stringent requirements but also goes beyond, providing customers with secure API-based access to permissioned financial data, eliminating screen-scraping, and achieving broad integration with ‘must-have’ apps through a single connection to our product suite. With Ninth Wave, financial institutions can confidently navigate the intricate landscape of data-sharing, ensuring operational efficiency and a robust approach to consumer data protection.
Contact us to learn more about how to move forward with compliance and create a competitive advantage by delivering Open Finance to your customers.
About Ninth Wave
Ninth Wave delivers secure, seamless, and standardized data connectivity to fintechs and financial institutions of all sizes, through a single point of direct integration to a universal suite of open finance APIs. With configurable controls, visibility, and insights into all data sharing and data acquisition connections between aggregators, third-party apps, and internal applications, Ninth Wave empowers financial institutions and their customers with access and oversight to their connected apps, enabling secure data exchange in a holistic and scalable open finance ecosystem. Offering solutions for retail and commercial banks, wealth managers, credit card issuers, tax providers, and more, Ninth Wave provides unparalleled connectivity and universal compatibility to complex information systems, unlocking innovation, potential, and performance for your data. Contact us to learn more about Ninth Wave’s secure data connectivity features. Empowering open finance. At scale, at last.
