| Entities | Consumer Financial Protection Bureau (CFPB) (186) European Union (3) |
| Topics and Issues | "Big data" (3) Alternative Data (18) |
In July 2023, Didier Reynders, the Commissioner for Justice and Consumer Protection of the European Commission, and Rohit Chopra, Director of the United States Consumer Financial Protection Bureau, announced the start of an informal dialogue between the European Commission and the U.S. CFPB on a range of critical financial consumer protection issues. They issued a joint statement today.
The joint statement called out several areas of common interest between the CFPB and the Directorate General for Justice and Consumers:
- “Financial institutions have expanded their deployment of automated decision making, including the use of artificial intelligence(AI). “
- “New products and services, such as Buy Now, Pay Later, are shifting the way people borrow and spend money.”
- “Digital payments are faster and more frictionless and are increasingly offered and controlled by Big Tech companies.”
To “compete with the pace of evolving markets and consumer needs… Commissioner Reynders and Director Chopra agreed to start a new dialogue on consumer financial protection, focusing primarily on digital developments in the financial sector and the impact on consumers, to improve policy and regulatory cooperation.”
The CFPB and the DG intend to
exchang[] technical expertise and coordinating on the most pressing policy issues. The dialogue will cover the following issues:
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- Automated decision making and processing of data in financial services, including the deployment of AI, and the related opportunities and risks for consumers such as the lack of transparency, misuse of data and violation of financial privacy rights, discrimination, and exclusion.
- New forms of credit such as ‘Buy Now, Pay Later’ products, and the related risks to consumers, including over-consumption and over-indebtedness.
- Strategies to effectively prevent over-indebtedness and to help over-indebted consumers to repay their debt sustainably.
- Digital transformation that ensures fair choice and access to financial services for consumers, including the unbanked, underbanked, and consumers who want to protect their own data.
- Implications for competition, privacy, security and financial stability of Big Tech companies offering financial services, including payment services