TECHNOLOGY companies to draw on capabilities otherwise undeveloped within their own organisation .
3 . Collaborative data-sharing ( inbound and outbound sharing of similar forms of data ) = allowing companies to create richer , larger and more comprehensive datasets than siloed efforts could achieve . This is particularly important as forming ‘ data lakes ’ becomes more popular .
And yet , despite the mutual beneficiality of data sharing , there still exist several potential drawbacks and aversions to overcome . For customers , there is a persistent reluctance to share sensitive data –
Statista found that approximately 44.3 % of US fintech app users experienced some degree of discomfort , whether related to account balances , loan history or investment information . Worse , a
Harris Poll survey conducted on behalf of IBM found that only 20 % of respondents “ completely trust ” organisations to properly maintain their data . With incidents of
“ Open Finance is all about empowering customers ”
JACK WILSON , HEAD OF POLICY AND REGULATORY AFFAIR , TRUELAYER
compromised security involving major companies like Capital One and Microsoft still making headlines , this is , perhaps , not unsurprising .
Data sharing is also not without risks for FSIs themselves ; creating such a forthcoming environment could erode competitivity by handing too much information to rivals , complex and evolving privacy regulations like GDPR and PSD2 could be breached by unforeseen tech developments , or companies could simply alienate clients by appearing too omniscient for comfort .
Among VC firms and investors data sharing is an important decision-making component , particularly during early-stage investment . Michael Conn , Chairman , CEO , and Co-Chief Investment Officer at Zilliqa Capital , explains ,
BENEFITS OF SHARING DATA DRAWBACKS OF SHARING DATA
For institutions : better decision-making , access to third-party capabilities , greater scale of data
For regulators : support for innovation and competition , enables effective system oversight
For institutions : competition hindered by lack of secrecy , could breach privacy regulations , could potentially alienate customers by appearing ‘ omniscient ’
For regulators : possible breach of customer privacy
For customers : access to higher quality and more efficient products
For customers : personal data could be mishandled or misused