Section 1033: Data Isn’t Free

The big news this past week in fintech comes from Evan Weinberger and Paige Smith, two favorite journalists of mine at Bloomberg, who reported that JPMorgan is telling fintech companies they must pay for accountholder data. According to Bloomberg’s reporting, the bank has told aggregators like Plaid that they’ll now need to pay for continued access to JPMorgan customer data, which was previously provided at no cost under a data-sharing agreement. While the specifics aren’t public, the implication is clear that the era of “free” data might be over. 

President Obama signing Dodd-Frank in 2010. Everyone is excited, but Biden and Maxine Waters are staring each other. Why? Nobody knows.

2010’s Dodd–Frank Wall Street Reform and Consumer Protection Act, which was born out of the massive harm inflicted on Americans by financial institutions, included a key section, 1033, which requires financial institutions to make consumer data available.

You can find Section 1033 on page 633 (of 848), which reads:

SEC. 1033.  CONSUMER RIGHTS TO ACCESS INFORMATION.

    (a) In General.--Subject to rules prescribed by the Bureau, a  covered person shall make available to a consumer, upon request, information in the control or possession of the covered person  concerning the consumer financial product or service that the consumer obtained from such covered person, including information relating to any transaction, series of transactions, or to the account including costs, charges and usage data. The information shall be made available in an electronic form usable by consumers.

In more plain language, the rule states that if a bank holds your data, they have to make it available to consumers in a format they can actually use. 

It took a very long time (until last year!) for the CFPB (the mentioned Bureau in Section 1033) to make the rules as stated in the legislation. 

Banks didn’t like the new rule from the CFPB, so they immediately sued to block the rule. As soon as the Trump administration came to power in January, the suddenly-defanged CFPB declined to defend the rule, claiming it was a reach in a capricious manner (although given all the time in the making, I don’t think it was in any way capricious). 

You can read more about this history in Jason Mikula’s Fintech Business Weekly.

What I want to discuss is the central argument here: how open banking data both helps and hinders fintech companies, card programs, and banks. I would argue that data is valuable. I think this is a good moment to remind everyone of the real quote behind “information wants to be free.”

On the one hand you have—the point you’re making Woz—is that information sort of wants to be expensive because it is so valuable—the right information in the right place just changes your life. On the other hand, information almost wants to be free because the costs of getting it out is getting lower and lower all of the time. So you have these two things fighting against each other.

-Stewart Brand, Hackers Conference, November 1, 1984 (video!)

This thinking applies to open banking data, which is extremely valuable. However, thanks to APIs and modern processing costs, the actual cost of distribution continues to decline. This shift has opened up a new argument about the data. 

For years, banks complained about data aggregators like Plaid and Yodlee using scraping practices to access consumer data. The push towards APIs was supposed to fix that by providing cleaner, safer, and (perhaps more importantly in this context) bank-controlled ways to access records. This move by JPMorgan shifts the conversation away from whether consumers can access their data and by what means, towards how much that access should cost and who is going to have to pay for it. 

Want to learn more about Data Aggregators? There's a report for that!

It’s not so much that most consumers want their data to be free and easy to access solely for themselves (budgeting is not a popular activity), but that people want the outcomes of data accessibility. Consumers want:

1. Accurate underwriting
2. Easy payments
3. Not to enter ACH routing information
4. To search transactions easily across accounts
5. Budgeting tools
6. Many other things ...

Open banking helps with these needs. Generally speaking, consumers are in favor of it. There are entire fintech businesses and categories built around assuming access would remain free. If banks start charging aggregators, underwriters, or income verifiers for their access, it begs the question of what the costs of products consumers have to rely on may look like in the future.

That said, this is a form of government-mandated disruption. I suppose a bank can claim that as long as consumers can download their own data, they are satisfying 1033. I am not a lawyer, but I don’t think 1033 says, “You must let people use Plaid.” 

Banks don’t want to make it easy for others to ingest their data because it has so much value. If it’s easier for consumers to verify and validate ACH data, that can lead to pay by bank replacing cards and reducing bank interchange revenue. Which, unsurprisingly, they don’t like. In reality, I don’t think pay-by-bank makes cards go away. If banks want to make more money on ACH transfers, they should figure out how to charge for them.

So there is a tension here between what consumers want, what banks need and are incentivized to do, and what the law actually says. Banks are not wrong to see value in the infrastructure they have built, and providing secure, reliable access to data is not free. However, Section 1033 was not written to protect existing revenue models. It was written to give consumers more control and transparency.

If charging for API access supports better infrastructure, that is fair. But charging to block competition, whether it is pay-by-bank or third-party income verification, is not aligned with the law's intent.

If JPMorgan sets the standard for paid data access, it is likely that every major bank will follow. What was once a compliance obligation may quickly become a new revenue stream. That shift could redraw the economics of fintech, and the cost may ultimately be paid by the very consumers 1033 was meant to protect.

Wire Upgrades!

Did you notice a lot of email messages from your bank about “not being able to execute wires this weekend” and think to yourself, “Wires?” Well, many businesses use wires, and your cards do, too.

Last weekend, the Federal Reserve executed its long‑anticipated single-day conversion of the Fedwire Funds Service to the ISO 20022 messaging protocol . This upgrade replaces the legacy FAIM format and brings richer, more structured data into every wire transfer, enabling better interoperability across global payment systems and more detailed remittance information . For financial institutions, this meant ensuring systems could process complete address fields for sender, beneficiary, and intermediary banks, validating ISO templates, and having manual fallback plans during the quiet July 11–13 switch‐over window .

Logos for reference (I'm really stretching for images this week)

It’s easy to overlook how the wire transfer network underpins card‑based payments. When you swipe, chip, tap, or enter card details, you’re traversing rails managed by the issuing bank, acquiring bank, and card network, but the back‑end settlement for those transactions often flows over Fedwire (in the US). Remember: Visa and Mastercard are messaging networks, and the money moves over the wire! That means ISO 20022 doesn’t just modernize wires, it also future‑proofs a core plumbing shared by high‑value card settlements, cross‑border ACH, and real‑time railslike RTP and FedNow. In short, this conversion is as much about upgrading card‑linked infrastructure as the wire rails. See, I knew there was a way to make everything about cards.

CardsFTW

CardsFTW, released weekly on Wednesdays, offers insights and analysis on new credit and debit card industry products for consumers and providers. CardsFTW is authored and published by Matthew Goldman and the team at Totavi, a boutique consulting firm specializing in fintech product management & marketing. We bring real operational experience that varies from the earliest days of a startup to high-growth phases and public company leadership. Visit www.totavi.com to learn more.

Interested in reaching our audience? You can sponsor CardsFTW.