Financial Data Exchange: Switzerland in International Comparison

FiDA expands the scope of PSD2 and PSD3, which are limited to payment accounts. For example, an insurance company with access to comprehensive financial data could analyze a customer’s financial liabilities and assets to create an insurance policy tailored to the customer’s needs and risks. Or a financial advisor with access to a comprehensive database of his clients could use this information to develop a holistic financial strategy that includes both investments and insurance.

On paper, the regulation sounds promising. However, successful implementation is not a sure thing. Uniform standards and service level agreements, clear certification processes, and an adequate compensation system for the high implementation costs of data providers are some of the practical challenges. At the heart of the Open Finance Regulation, however, is the mandatory consent of individuals to the disclosure of their data. This raises not only the issue of data protection, but also the question of whether households are willing to share their data with third parties in the first place. According to studies, about 40% of respondents worldwide are willing to share their financial data with third parties if they receive added value in return, and about 30% if they receive personalized services. So there is still a lot of convincing to be done, especially in countries like Germany, where, according to the German insurance industry, 56% of households are not yet willing to share their data with third parties.

Observers agree on one thing. FiDA will, over time, have a significant impact on international competition in the financial sector – both inside and outside the EU. EU financial service providers could gain a competitive advantage over financial centers such as Switzerland or the UK, as the EU offers a consistent regulatory framework that attracts fintechs and fosters innovation clusters. This allows for more comprehensive and competitive services and easier expansion of innovative financial technology firms. The UK government has already announced new legislation. The challenge for Switzerland is to find its own way to avoid falling behind in international competition while maintaining its market economy principles.

Gabriel Juri
SIX