CFPB poised to let big banks charge billions in data fees

RIABiz reports that the CFPB is expected to rule within the next month in favor of banks, granting them the right to charge fintech companies for consumer financial data access. The ruling would settle Rule 1033, the Personal Financial Data Rights rule, which has been stalled since a federal court enjoined its enforcement.

According to RIABiz, Schwab, Fidelity, and JP Morgan have campaigned since November 2020 to defeat proposed fee bans. The CFPB moved to ban data fees in 2024, but the Trump administration paused the rule, allowing banks to negotiate fees with aggregators from a position of strength.

RIABiz quotes Will Trout of Datos Insights predicting a 'structured fudge' that 'enshrines' bank fees while attaching a reasonableness or cost-basis standard as a concession. Trout told RIABiz he doubts the standard will have teeth 'given who is running the agency.' The data fees could total billions of dollars.

The ruling likely ends an era of free data access. Fintechs that rely on bank data will face higher costs, and those costs may pass through to advisors and consumers. RIABiz notes that data that was mostly always free is now marked up to retail.

For RIAs, the exposure is indirect but material. RIAs depend on data aggregators to power account aggregation, billing, and reporting tools. If aggregators pay more for bank data, RIA technology vendors will likely absorb or pass on the increase. This shift has direct implications for RIA data access, as flagged by PWD's editor.

The 'structured fudge' is a classic Washington compromise. Banks get an enshrined revenue stream, fintechs get a nominal cost-basis standard, and the CFPB gets to call it consumer-friendly. The real question is enforcement. If the standard lacks teeth, the check on fee levels is weak.

The stakes are asymmetric. Banks control the underlying accounts and therefore the data. Aggregators like Plaid are intermediaries and cannot easily substitute away. For RIAs, this is a reminder that data access is a utility, and utilities charge rent. Everyone downstream pays.

Watch for the final CFPB rule next month, and for how aggregators price the new fees. The enforceability of the cost-basis standard will determine whether the fudge holds.