The Joint Committee of the European Supervisory Authorities (ESAs) published its final report on Big Data, analyzing their impact on consumers and financial firms. The report results from a consultation conducted between December 2016 and March 2017.
The objectives of the report were firstly to map the phenomenon and assessing the potential risks, and secondly to raise awareness of consumers of their rights in this regard and to encourage financial institutions to fulfill their obligations in setting the ongoing legislation features.
The main finding is that, despite some potential risk could affect consumers of financial services, the benefits of such innovations should outweigh the detriments. Consumers will profit from more tailored products and services, improved fraud analytics and enhanced efficiency of organisational internal procedures.
They must however be aware of the potential for errors in Big Data tools, which may lead to incorrect decisions being taken by financial service providers. Furthermore, Big Data set on an increasing level of segmentation of customers, which may potentially influence the access and availability of certain financial services or products.
The ESAs will continue to monitor any development in this area, and invite financial firms to develop and implement good practices on the use of Big Data. However, no legislative interventions will be taken at this time, as many of the identified risks are currently mitigated by the existing legislation. The ESAs have created also a factsheet on Big Data, aimed at informing consumers of financial services on the reports’ key findings.