Everything Is Changing with 1033

What is 1033? Understanding CFPB Section 1033 Rule making

Learn what the CFPB is covering in the Dodd-Frank Section 1033 proposed rule making and key considerations for financial services providers going forward

JANUARY 17, 2024

Table of Contents

What is the CFPB? What is the Dodd-Frank Act and how does it relate to Section 1033? How is the CFPB gearing up to put Section 1033 into practice? What does this mean in the simplest terms? When is the rule likely to be released? What data is covered by Section 1033? What are the compliance dates?

Introduction

Nearly 9 out of 10 people use some type of fintech app, and their reliance on those apps continues to grow. In fact, 47% of consumers use three or more fintech apps today and 13% use six or more.

As demand for data connectivity grows, financial organizations, aggregators, and industry groups are working to make it easier for consumers to safely share their financial data via open banking APIs.

In October 2023, the Consumer Financial Protection Bureau (CFPB) proposed a rule to accelerate the shift to open banking and establish stronger financial data rights. The proposed rule, which would be the first to implement Section 1033 of the Consumer Financial Protection Act, would require banks and other data providers to help consumers access and share their financial data through safe, secure, and reliable developer interfaces (APIs).

This article shares insights for planning your organization’s digital finance strategy as the CFPB works to finalize its 1033 rule making.

What is the CFPB?

The Consumer Financial Protection Bureau (CFPB) is a federal government regulator that was founded in 2011 as part of the Dodd-Frank Act. It implements and enforces federal consumer financial laws and protects consumers in the financial marketplace by ensuring they have access to fair, transparent, and competitive markets for consumer financial products and services. 

What is the Dodd-Frank Act and how does it relate to Section 1033?

The Dodd-Frank Wall Street Reform and Consumer Protection Act, also known as Dodd-Frank, was enacted in 2010 as a direct response to the financial crisis of 2007-2008. Dodd-Frank established a series of rules and agencies, including the CFPB, to promote the financial stability of the United States by improving accountability and transparency across the financial services ecosystem. 

Section 1033, part of Dodd-Frank, gives consumers the right to access and share their financial data. Section 1033 requires financial services providers to make available to consumers – and representatives acting on their behalf – certain information in those providers’ control. This can include information like a consumer’s transactions or the balance in their financial account.