As Europe advances toward enhanced open finance with the proposed Financial Data Access (FIDA) legislation, concerns are mounting among financial industry stakeholders.

The European Council recently reached an agreement on a phased implementation of FIDA, aligning with the European Commission’s vision to enable seamless data sharing among financial institutions. The goal is to foster a competitive financial landscape by facilitating personalized financial products, such as tailored investment opportunities and simplified loan processes. Proponents argue that these measures could improve access to finance for consumers and small businesses alike. However, the Council now faces negotiations with the European Parliament to finalize the legislation.

In response, several leading financial associations, including the European Banking Federation and Insurance Europe, have urged a cautious approach. Their joint statement emphasizes the need for a "focused and evidence-based" framework, citing potential risks to consumer protection and industry competitiveness if the legislation is rushed. The associations advocate for more time to assess FIDA’s practical and broader impacts to ensure it benefits European citizens and businesses without compromising the sector’s integrity. Without such scrutiny, they warn, FIDA may fall short of its ambitions and negatively affect the financial ecosystem.