Trump led the way on open banking; now it’s time to accelerate

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In light of the Consumer Financial Protection Bureau’s recently finalized rulemaking under Section 1033 of the Dodd-Frank Act, the popular narrative has come to associate U.S. open banking with democrats and the Biden administration. But, in fact, it was President Trump who first initiated the creation of common-sense rules-of-the-road for open banking — allowing individual citizens and private-sector entities free and fair access to financial data and laying the foundation for unprecedented innovation and competition in U.S. financial services. Now, the president has the opportunity to build upon this foundation and cement American leadership in financial services for decades to come.

In July 2018, President Trump expressed a strong commitment to open banking in his Treasury Department’s report, “A Financial System That Creates Economic Opportunities: Nonbank Financials, Fintech, and Innovation,” calling for a “sustained commitment to the principle that consumers should be able to freely access and use their financial account and transaction data.” His administration made bold recommendations to bolster open banking under Section 1033, including that the CFPB should affirm a consumer’s right to freely access and use their financial data, that this right extends to consumers’ authorized fintech providers, and that other regulators should facilitate similar access for accounts outside of Section 1033, like securities, retirement and benefits accounts.

Then in October 2020, just days before the presidential election, President Trump’s team published detailed plans for open banking through an advance notice of proposed rulemaking under Section 1033. This move established the formal foundation for American open banking — a foundation that has supported explosive growth in financial innovation.

Today, the United States leads globally with over 10,000 fintech companies (compared to 9,200 across all of Europe). U.S. fintechs attract approximately 46% of global fintech investment, with projections showing an increase to 62% by 2030.

Fintech products have also reached mass adoption in the United States — the proportion of U.S. consumers using fintechs has grown from 58% in 2020 to 80% or more today. Fintech companies today provide consumers with digital banking alternatives, convenient payment options, assistance with budgeting and financial planning, and expanded access to credit, all enabled by open banking. Open banking is creating massive new revenue opportunities for traditional financial institutions as well, through new open banking-powered offerings like pay-by-bank and cash flow underwriting. Finally, the competition and access created by open banking has also become an essential safeguard against debanking.

Following the directive of President Trump in his first term, the CFPB implemented a comprehensive Section 1033 open banking framework in 2024 as required by Congress. By allowing consumers to freely share their banking data with other financial services providers — at no cost — this initiative opens the U.S. financial services market to new innovators and competitors, combats inflation by driving down consumer costs through competition, and prevents debanking through increased choice and easier portability of data.

But this is still just the beginning. The new Trump administration has the opportunity now to build upon the open banking foundation that it set the first time around. President Trump’s January 2025 executive order, “Strengthening American Leadership in Digital Financial Technology,” provides a clear blueprint for how America can cement its global leadership in financial services innovation through open banking, including by “protecting and promoting the ability of individual citizens and private-sector entities alike to access and use for lawful purposes open [financial] networks without persecution, including the ability to develop and deploy software, [and] to transact with other persons without unlawful censorship. …”; “protecting and promoting fair and open access to banking services for all law-abiding individual citizens and private-sector entities alike”; and “providing regulatory clarity and certainty built on technology-neutral regulations, frameworks that account for emerging technologies [and] transparent decision making … all of which are essential to supporting a vibrant and inclusive digital economy and innovation. …”

To build upon President Trump’s open banking foundation and realize its potential to usher in a more competitive and prosperous financial marketplace, the administration should consider the following aims. First, the administration has the opportunity to streamline the current Section 1033 framework to eliminate unnecessary compliance burdens, like annual reauthorization, while maintaining consumer protections. Second, the administration should expand productive data utilization by permitting de-identified or pseudonymized open banking data to be used for new product development and research, ensuring the United States stays competitive with foreign markets like the U.K. and EU. Third, the administration should prohibit data access fees and ensure that banks cannot charge for providing customers’ financial data through open banking channels — allowing such fees would effectively create a tax on innovation, stifle competition, increase the cost of credit and restrict Americans’ financial freedom. Last, the administration can prevent debanking by creating explicit protections ensuring that banking services and access to open banking data cannot be denied based on political affiliation or legitimate business activities.

President Trump’s first administration laid the foundation for open banking in the United States through market-oriented principles. His second administration now has the opportunity to build upon this foundation and ensure that America remains the undisputed global leader in financial services innovation for decades to come.

Expanding open banking will unlock billions in fintech innovation, driving significant growth in bank and financial technology stocks, and bolstering the broader market as investors recognize America’s strengthening position in the global financial technology race. The resulting market expansion will benefit not just Wall Street investors but everyday Americans with retirement accounts invested in America’s financial future.

President Trump’s recent executive order on strengthening American leadership in digital financial technology sets forth a blueprint for prioritizing financial freedom, data access and portability through open networks, innovation and competitive markets. By applying this blueprint atop the open banking foundation he’s already built, President Trump can deliver on his promise to put America first in the global financial ecosystem while expanding economic opportunity for all Americans.