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25 Nov, 2019

New Research Reveals Most Consumers Unaware of Financial Data Collection Practices

NEW YORK, Nov. 19, 2019 /PRNewswire/ — Today, The Clearing House (TCH) released the 2019 Consumer Financial Apps and Data Privacy Survey that shows there is a growing disconnect between what consumers think they know about financial data collection practices and what they actually know.

The 2019 survey findings show that 54% of U.S. banking consumers use financial apps to help manage their money, and 70% of users are confident that their information is private and secure. However, there is a notable misunderstanding about what data is collected and how it is stored and shared.

Among banking consumers who use financial apps:

(+) There was general lack of awareness of what data is being collected – for example, 80% are not fully aware that the apps or third parties may store their bank account username and password.

(+) There was a general lack of awareness of how long data is accessed – for example, only 21% are aware that financial apps have access to their data until they revoke their bank account username and password.

“Financial apps have the potential to provide significant benefits to consumers, but the mechanisms by which they gain consumer consent leaves a lot to be desired,” said Ben Isaacson, senior vice president of product strategy at TCH. “Our new survey reinforces the need for more transparency, education, and control for consumers as the use of financial apps continues to grow.”

Survey respondents voiced strong support for more education about financial apps, more control over their information, and other steps to enhance data privacy and security. For instance, 65% of respondents supported actions that would require clear disclosure of what data third parties can access, and 59% want easier ways to control how their data is accessed and used.

TCH is working to expand consumer awareness about how financial apps access, collect, store, use, and share users’ personal and financial data as part of its Connected Banking initiative, which aims to facilitate innovation and customer control and the secure exchange of bank-held data.

TCH initially fielded the consumer survey in 2018 and updated the questionnaire in Q3 2019 to get a fresh take on what consumers understand when it comes to the use of their personal financial data, gather information on the current landscape and how it has evolved, and uncover new insights into consumers’ mindsets at the intersections of finance, convenience, security, and privacy.

Hall & Partners conducted the Q3 2019 survey on behalf of TCH between July 31 and August 14, 2019. It was conducted online and consisted of a total sample of 3,967 U.S. banking consumers – 1,999 financial app users and 1,968 non- financial app users.

For more information, visit: https://www.theclearinghouse.org/connected-banking/consumer-research.