Trustworthy and sustainable data access is the underpinning factor of any healthy data ecosystem. This is true in regulated environments where data is particularly sensitive; privacy and confidentiality are essential; and the risks – and potentially costs – regarding compliance are high.
The ODI and RegulAItion – with funding by Innovate UK’s Industrial Strategy Challenge Fund – have worked together to explore the landscape of data access across the banking, accounting and legal sectors. In particular we researched how innovative privacy enhancing technologies (PETs), and developments in machine learning (ML) and artificial intelligence (AI) could improve trustworthy and sustainable data access across these sectors.
Historically, the banking, accounting and legal sectors have been relatively change resistant regarding deploying data access technologies, with much of their technological investment focused on data privacy and security instead. This is due to several factors, including that crucial elements in their services are confidentiality and trust. In fact, as an industry expert said during our research: ‘Trust is the main product accountants sell’.
Despite this deeply embedded culture of privacy and risk aversion, there have been some key progress made in these sectors. The most substantial of these is in the finance sector with the implementation of open banking – a data portability initiative intended to give consumers greater control over data about their finances, and to reduce the market power of the UK’s nine largest banks. The accounting and legal professions have not had such a seismic policy change, but have been investing in ML and AI technologies to augment the skilled work of professionals in the field.
There is now an opportunity for more data innovation across these sectors. Findings from our research have shown that these changes can be seen in three interconnecting ways: capacity building in people, improvements in processes and advancements in technology
Although large organisations like multinational finance firms are investing a lot on people, processes and technology in-house, a relatively new role has emerged that is also well poised to provide these solutions to the market: the data intermediary. Intermediaries facilitate the access to data and information across data ecosystems. This is often done by collating disparate data sets in a central location and vetting providers and users of that data. New developments in PETs such as federated learning also allow intermediaries to increase information flows in an ecosystem without ‘raw’ data ever being accessed or shared.
This new generation of intermediaries, including RegulAItion, is creating value within their ecosystems without direct data access, improving security, privacy and data governance. When data intermediaries securely facilitate valuable data and information flows in a sector, they help to build a more open, trustworthy and sustainable data ecosystem.
Data access needs to be improved so that the regulated data ecosystems can further realise the benefits of data innovation – through better products and services, improved consumer outcomes and easier legal compliance. Data intermediaries have an important role to play in this, but all within the ecosystem need to play their part.
Greater data collaboration between data providers and data intermediaries within the banking, accounting and legal sectors will create more sustainable and trustworthy data ecosystems, ultimately driving greater value to businesses, consumers and wider society.