The financial services industry faces significant uncertainty following the announcement on February 3, 2025, of an immediate stop work order affecting all Consumer Financial Protection Bureau (CFPB) regulatory and enforcement activities. This development has particular implications for the implementation of Section 1033’s final rule on consumer data access rights, which was scheduled to begin taking effect for large institutions in April 2026. The halt comes at a critical juncture in the open banking transformation journey for U.S. financial institutions (FIs). This video provides an overview of the implications and three recommendations for steps to take to ameliorate the impacts.
Many banks and financial technology companies have already invested substantial resources in preparing their technical infrastructure and security frameworks to comply with the rule’s requirements. The Financial Data Exchange (FDX), recently recognized as a standard-setting body by the CFPB, has been actively working to align its API specifications with the rule’s mandates.
Industry analysts suggest this regulatory pause could have far-reaching consequences for both implementation timelines and strategic planning. Financial institutions currently find themselves in a complex position—needing to balance their ongoing modernization initiatives with the uncertainty surrounding regulatory requirements. The situation is particularly challenging for institutions that have already allocated significant budgets and resources toward compliance efforts.
From a technical perspective, many institutions are likely to continue their core API infrastructure development, as these capabilities align with broader digital transformation objectives beyond regulatory compliance. However, decisions about specific implementation approaches, especially regarding consumer and developer interfaces as prescribed by Section 1033, may need to be reevaluated.
Looking ahead, FIs are advised to maintain flexibility in their implementation approaches while continuing to focus on foundational capabilities that support secure, efficient data sharing. This includes maintaining engagement with industry bodies like FDX to stay informed about evolving technical standards and best practices.
The stop work order serves as a reminder of the inherent challenges in balancing innovation with regulatory compliance in the financial services sector. As the industry awaits further clarity on the future of Section 1033 implementation, maintaining a flexible, risk-aware approach to open banking initiatives will be crucial for success in this evolving landscape. Industry stakeholders are advised to closely monitor developments and maintain open lines of communication with their regulatory contacts, technology partners, and industry peers during this period of transition. While the immediate future may be uncertain, the broader trend toward open banking and enhanced consumer data access rights appears likely to continue, albeit potentially along a modified timeline and framework.
