Europe wants to exclude Apple, Meta, and other large tech companies from the FiDA regulations, which will govern access to financial customer data of EU citizens.
The European Union wants to exclude Big Tech from the Financial Data Access (FiDA) regulations. FiDA aims to create a framework for securely sharing financial customer data. Such data is typically held by banks. FiDA includes regulations that allow financial data to be safely shared with third parties. This should enable innovation and new services in the financial sector.
FiDA without Gatekeepers
The EU now plans to exclude large gatekeeper companies such as Google, Amazon, Apple, and Meta from access. Gatekeepers are large companies responsible for so-called core platform services with a significant impact on the European digital world, as defined by the DMA.
read also
“EU Wants to Deny American Tech Giants Access to Financial Customer Data”
The legislative proposal for FiDA has been on the table since 2023 and was expected to be finalized within a few weeks. The Financial Times was able to view a document showing that Germany is joining a call to exclude Big Tech through the regulations. This should promote the development of a European financial ecosystem and would safeguard customers’ digital sovereignty.
Back-and-forth Lobbying
The financial sector is lobbying strongly for the exclusion of American tech giants, and the European Parliament has already jumped on the bandwagon. Now that Germany is also playing the protectionism card, it’s likely that FiDA will effectively block access for the so-called gatekeepers.
The main argument of opponents to FiDA access for Big Tech is the fear that they will misuse customer data primarily to create value for themselves. By persuading users to link a (cheap or free) Big Tech service to their bank details, they can also use the financial data themselves in the margin of providing that service. Users’ spending patterns are very valuable to Google and Meta, who make most of their money by selling personalized advertisements.
The tech companies are, of course, lobbying for the opposite. They argue that customers will be the victims if they are excluded. They claim that Big Tech doesn’t play the role of gatekeeper in this context, but rather the banks do. The banks could consolidate their role with FiDA.
European Innovation vs. Customer Choice
There are multiple considerations at play. On one hand, the very purpose of FiDA is to enable a European ecosystem of services and applications on top of financial data. If Google, Apple, Meta, and other large non-European companies fully benefit from this, the regulation misses its effect. In that scenario, the EU would have created a framework that enables a new form of entanglement with non-European services.
On the other hand, one of the pillars of FiDA is precisely control on the customer’s side. The framework requires financial service providers to enable full access to their customer data through a standardized technical interface, but whether third parties get access, which ones, and for what purpose, will be entirely up to customers to decide. In this respect, an American tech company would only gain access to a customer’s data when that customer effectively grants access.
Fear of Market Dominance
It now appears that the EU doesn’t assume the gatekeepers will play fair with FiDA access. They have such an overweight in the market that there’s a chance they will use their monopolistic positions to win the new market that FiDA creates for themselves, before European alternatives can see the light of day.
How FiDA will ultimately look remains to be seen. The final text still needs to be approved by all authorities. In any case, it’s notable that both parliament and member states are interested in excluding Big Tech, especially since that will irritate US President Trump. He already believes that the (albeit extremely dominant) American companies should have more unrestricted access to European markets. It won’t be surprising that the president has already threatened import tariffs.