PSD2 was ratified back in the summer, following intense discussion between associations and politics, but especially between the banks and fintechs. The “elephant in the room” was: will fintechs be taking a slice of the bank’s cake in future? All these talks were held prior to the Directive’s endorsement and, for the most part, in expert circles. Unsurprisingly, of course, this was done without asking the real customers how they’d like things. Business as usual.
Rewind... Thanks to a journalist who addressed the topic in November 2017, the Directive made no less than a front-page story in Germany’s popular tabloid, BILD. Honour to whom honour is due. “Why your account data are in peril...” was the headline intended to arouse readers’ curiosity. PSD2 has meanwhile reached the broader population. And BILD is finally doing something to improve Germans’ insight into financial matters. Too bad, though, that the author himself has, perhaps, only a very superficial understanding. Or was he was only intent on posting a front-page article? Fears continue to be stirred in the social media to this very day: just recently, for example, an expert was asked whether amazon now has full access to its customers’ account data and how this could be prevented.
We know better: amazon can do so, but only with the customer’s permission! With this, consumer protectionists prick up their ears. If amazon cooperates with service providers which – only with consent – allow amazon to take a glimpse at an account, what will amazon do with the data? PSD2 proponents would then say that customers can receive made-to-measure advertising in future, or pay less if the account is short of funds. No, your eyes are not deceiving you: amazon’s becoming social!
Critics, by contrast, see the floodgates being opened for data misuse. Machines can concoct a plethora of theories based on the account data, and easily reach the wrong conclusion. The outcome: the customer may be refused delivery, or credit may not be authorised.
For the most part, account data are accessed and fed into customer services not by the banks but by service providers. For years, banks have been complaining that they’re unable to use their customer data. And now, it is others who are enjoying that privilege (albeit with the customer’s consent). More reassuring for most customers, however, would be if such services were offered by their own house banks. A customer with a demonstrable benefit will generally also agree to the use of his data – especially if these are processed and remain within the bank.
The banking industry is now urgently called upon to develop or purchase exactly such services. Banks should regard precisely the giro account as a broad-based service platform – for value-added customer services with income-generating potential in times of less-lucrative interest-earning products.