Data and de-banking: Know what you must


  • De-banking has caused significant challenges for financial services institutions, including increased regulator and government scrutiny, access requests, and litigation.
  • A recent webinar with representatives from the FCA and ICO provided insights and practical takeaways for dealing with de-banking.
  • The key takeaways include the importance of customer trust, the balancing act between financial crime prevention and customer rights, the relevance of data protection laws, the importance of collaboration, and the role of innovation and new legislation.

Data and de-banking have become major issues for financial services institutions, with account closures affecting political figures, charities, small businesses, and retail customers. This has increased regulatory and government scrutiny, as well as access requests and litigation. To address these challenges, a webinar was held featuring representatives from the Financial Conduct Authority (FCA) and the Information Commissioner’s Office (ICO).

The webinar highlighted several key takeaways for dealing with de-banking:

  • Customer trust has been harmed by de-banking, but confidence is slowly returning. Financial crime prevention remains a priority for both the FCA and the UK Government.
  • Firms must strike a balance between implementing financial crime measures and protecting customers’ rights. Data protection laws can guide firms in minimizing risk in their anti-fraud and monitoring activities, ultimately leading to positive customer outcomes.
  • Adherence to the UK GDPR principles is crucial, with a particular focus on fairness, data minimization, and accuracy.
  • Collaboration and cooperation between the private and public sectors are essential in the fight against financial crime. Responsible data sharing between firms can help prevent financial crime, as long as it is done in compliance with the law.
  • The ICO and FCA support innovation and have initiatives in place to facilitate it, such as the ICO’s innovation advice service and regulatory sandbox. However, the use of AI in detecting and reducing financial crime also presents data risk.
  • New legislation, such as the data sharing provisions in the Economic Crime and Corporate Transparency Act 2023 and the forthcoming Data Protection and Digital Information Bill, will have an impact on data and de-banking.

Overall, the webinar provided valuable insights and practical guidance for financial services institutions dealing with the challenges of de-banking.