Breaking News
LAST CHANCE for Cyber Monday SALE: Up to 54% off InvestingPro! Register here
Investing Pro 0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

U.S. consumer watchdog to review Big Tech data, promote lending competition

Stock MarketsOct 27, 2021 04:33PM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters. FILE PHOTO: The seal of the Consumer Financial Protection Bureau (CFPB) is seen at their headquarters in Washington, U.S., May 14, 2021. REUTERS/Andrew Kelly/File Photo

By Katanga Johnson and Pete Schroeder

WASHINGTON (Reuters) -Chief consumer finance watchdog Rohit Chopra told U.S. lawmakers on Wednesday his agency will review Big Tech's impact on the flow of money in the economy as leading technology firms use real-time consumer payments systems that collect huge amounts of personal data.

Chopra, head of the Consumer Financial Protection Bureau (CFPB), said Big Tech's entrance into the payment sector raises questions, including: "How will these firms harvest and monetize data they collect on our transactions? What criteria will they use to decide who is removed from the platform? How will they ensure that payment systems adhere to consumer protections?"

The agency will also aim to minimize foreclosures on struggling American homeowners and make consumer lending more competitive, he said.

And, it will sharpen its enforcement focus on companies that repeatedly violate consumer finance laws.

Chopra, a longtime consumer advocate tapped by Democratic President Joe Biden, outlined an ambitious agenda during his first of two congressional hearings this week as CFPB director. Wednesday's hearing before members of the House of Representatives Financial Services Committee will be followed by a Thursday sitting to testify before the Senate Banking panel.

"Many families continue to struggle to afford their mortgage and rent payments. Many small businesses are facing severe challenges to make ends meet," Chopra told the panel on Wednesday.

Chopra's hearing will likely reinvigorate the CFPB's status as a political lightning rod. Republicans have sought to handcuff the agency since its creation, calling it overpowerful and unaccountable.

Sworn in as the CFPB's full-time director earlier this month, Chopra built his name as a fierce defender of middle-class Americans at the Federal Trade Commission, and previously helped Senator Elizabeth Warren set up the CFPB after it was created in 2010.

"This hearing should serve as a reminder of both the bureau’s broad authority and Director Chopra’s capacity to effectively use the bureau’s toolbox," said Isaac Boltansky, director of policy research for financial firm BTIG.

Just a few weeks into the job, Chopra made his mark when the CFPB ordered https://www.reuters.com/technology/us-consumer-watchdog-orders-tech-giants-turn-over-information-payment-systems-2021-10-21 Amazon.com Inc (NASDAQ:AMZN), Apple Inc (NASDAQ:AAPL) and Facebook Inc (NASDAQ:FB) to hand over information about how they gather and use consumer payment data.

"There are many places where regulators should be promoting competition and innovation in ways that are good for small businesses and families -- and not in a way that allows dominant firms to control more and more about our lives through our data," Chopra said.

That push for clarity is part of a growing interest among regulators and lawmakers about the rapid adoption of technology in various financial products, ranging from cryptocurrency to new "buy now, pay later" lending products.

While Republican members of the panel applauded Chopra's decision to look into practices that might impede lending competition, they added that they were against a "heavy handed" approach to enforcement.

'OPEN BANKING'

Democrats' top policy priorities include boosting competition in the consumer finance sector by requiring financial companies to give consumers more control over their financial data -- a concept known as "open banking https://www.reuters.com/business/exclusive-white-house-target-bank-mergers-financial-data-with-competition-order-2021-07-09."

Analysts have said they expected the CFPB to move ahead with an open-banking rule first proposed by the agency under the former Trump administration in coming months.

Chopra said on Wednesday that he is studying such regulations in other countries and is eager to review the comments the CFPB has received on the proposal.

"At the same time, we're going to need to make sure we're protecting privacy, security and other things that are critical," he added.

The agency head said that while he wants to ensure payments platforms operate "fairly, transparently and competitively," he does not intend to ban or limit the use of cryptocurrency or blockchain technology that also lean on payment systems.

Chopra's expansive agenda at the CFPB will also include revisiting https://www.reuters.com/business/sustainable-business/how-bidens-agencies-are-picking-apart-trumps-wall-street-friendly-measures-2021-04-12 several major rule easings ushered through under Republican leadership, particularly around debt collection and payday lending.

U.S. consumer watchdog to review Big Tech data, promote lending competition
 

Related Articles

Omicron May Make Megacap Tech Even More Expensive
Omicron May Make Megacap Tech Even More Expensive By Bloomberg - Nov 29, 2021

(Bloomberg) -- Megacap tech stocks are already pricey, but the omicron coronavirus strain may make them even more expensive given their defensive characteristics. Strategists say...

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Comments (3)
Jokers R Us
Jokers R Us Oct 27, 2021 8:51PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Two weeks
Jose Maderno
Jose Maderno Oct 27, 2021 3:41PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
"Democrats' top policy priorities include boosting" donations to the Democratic party and cutting off their opposition from all media.  You know, like a true communist party.  Reuters supports their endeavor 100%.
Felipe Daniel
Felipe Daniel Oct 27, 2021 1:56PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Under Biden admin Big Tech will not be affected, they are partners in censuring free speech.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email