The UK's Financial Conduct Authority is calling for industry evidence on whether the data asymmetry between Big Tech and financial services firms could lead to the likes of Amazon and Google gaining entrenched market power in the FS sector.
Big Tech firms’ presence in UK financial services markets in areas such as payments, deposits and consumer credit has been steadily increasing, with the potential to expand further and change markets quickly.
In response to this, last year the FCA launched a study on the associated potential competition benefits and harms of the trend.
Industry feedback highlighted concerns about the asymmetry of data and data sharing mechanisms. The asymmetry arises, says the FCA, because financial services firms are unable to access Big Tech firms’ datasets which currently sit outside of data sharing initiatives, whereas financial services data can be accessed by Big Tech firms.
Some industry players fear the Big Tech firms can use this combined data with their advanced analytics and AI to impact how competition develops.
"We would like to gather more focused information and evidence to assess the risk of the market developing in a way where Big Tech firms gain entrenched market power because of this data asymmetry," says the FCA.
To do this, the watchdog has now put out a 'Call for Input' on the subject, asking FS firms, Big Tech players, fintechs, trade bodies and consumer groups for information and evidence by 22 January.