Envestnet | Yodlee, Quovo and Morningstar unite on SODA framework
Envestnet | Yodlee supports SODA
For those who believe the benefits of GDPR and open banking-like policies can be achieved in the US without the intervention of government regulation, the announcement that Envestnet | Yodlee, Quovo and Morningstar have formed a joint initiative to support secure, open data access for consumers is welcome news, indeed.
“Through our involvement in existing industry groups focused on data access standards, we have noticed that consumers are not always as top-of-mind as they should be,” says Anil Arora, CEO of Envestnet | Yodlee. “The principles released today reiterate our belief that it is the consumer’s right to both access their data and permit it to be references through trusted third-party tools and applications, and that this consumer-permissioned access should not be limited or restricted.”
The Secure Open Data Access (SODA) framework is designed to promote transparency and accountability within the financial services ecosystem, and features four primary tenets:
- Consumers must be able to access their financial account data for the purposes of using any legitimate application.
- Consumers must provide affirmative consent on the basis of clear and conspicuous disclosure regarding the use of their data.
- All entities who handle consumer account information must adhere to best practices for security standards and implement traceability and transparency.
- The entity responsible for a consumer’s financial loss must make the consumer whole. All stakeholders in the ecosystem have shared responsibility – this will start with traceability in the United States and move towards shared responsibility just like Europe.
Calling data sharing “a critical drive of innovation within financial services”, Quovo CEO Lowell Putnam adds: “as custodians of financial data, we all have a duty to ensure that consumers are empowered to access their data safely, securely, and with full transparency into how it is being used. Our joint framework provides direction for the industry on how to fulfill this responsibility.”
The initiative’s full statement of joint principles for consumers, financial institutions, aggregators, and policymakers was published at the Envestnet | Yodlee blog.
A provider of intelligent systems for wealth management and financial wellness, Envestnet acquired financial data aggregation and analytics platform Yodlee in 2015 for $660 million. Together, Envestnet | Yodlee unveiled a single API solution to support PSD2 and open banking compliance earlier this year and forged partnerships with open banking innovators like Token.
Founded in 2010, Quovo is headquartered in New York.
By David Penn, Finovate
