As part of its efforts to better identify and enforce potentially problematic or misleading behavior on the part of financial institutions, the federal watchdog tasked with protecting consumers’ finances is asking for more data from the institutions themselves. However, some of those companies appear to be growing resistant to these ongoing efforts.
The Consumer Financial Protection Bureau is now making greater efforts to get a larger amount of data on consumer borrowing and lending practices, and that includes both asking for more information from banks themselves and buying it from credit reporting bureaus, according to a report from Bloomberg News. However, banks say that the continued requests for more and more data they control might, to some extent, be too big an ask.
“Do they need the reams and reams and reams of data we’re having to provide to them?” Susan Faulkner, senior vice president at Bank of America Corp., asked at a conference in March, according to the news agency. “Don’t we have to find a healthier balance here?”
For its part, the CFPB says that all the information it is compiling is designed specifically to help it create the best possible regulations for all involved in the consumer credit industry, as well as associated companies, the report said. With more data to cull for research, it says it will be able to better understand the ways in which its rules are affecting banks themselves. Experts say its approach to collecting this information is not dissimilar to those of “big data” companies like Google and IBM, and some worry this might, in some way, constitute an invasion of privacy for consumers.
Perhaps one of the CFPB demands to which banks object most heavily is the request for information on credit card add-on products, the report said. These often prove quite popular among card issuers because of the ways in which they can add to bottom lines, but the agency may specifically be concerned with just how much these products actually help consumers to better deal with their debt.
The CFPB has been controversial more or less since its inception, as financial institutions and some lawmakers say its purview over many types of bank and nonbank businesses has little oversight itself. However, it may take some time for all the positive effects of its regulatory overhauls to be observed by all involved.