The purpose of this paper is to define the overall proposition for item P1, so that participants (ASPSPs and TPPs) and stakeholders (FCA, HMT, CMA) are clear about what is and is not in scope for this item, and how this will support regulatory requirements and key use cases.
Other pages in this section
The purpose of this paper
The following table is taken ‘as-is’ from the published roadmap (https://www.openbanking.org.uk/wpcore/wp-content/uploads/2017/11/FAO-CMA_Proposed-Amendments-to-Agreed-Arrangements_v_final-1.pdf):
The requirement to provide product information for back-book products was excluded from the March 2017 delivery. The published roadmap requires the development of back-book product data functionality in existing OB API standards.
Providers shall release and make continuously available without charge, in accordance with the Read-only Data Standard:
12.1.2 Product information, before the application of any negotiated changes, for each of their on-sale PCA products & BCA products, which shall include, where relevant:
(a) product prices including credit interest;
(b) all charges, including the interest rates (credit and debit) which apply to the product, the fees and charges which may apply to activity on the account, and the circumstances in which these charges apply;
(c) benefits, including credit interest and constituent parts of packaged accounts;
(d) MMC once MMCs have been introduced in accordance with Part 7;
(e) terms and conditions;
(f) customer eligibility criteria; and
(g) any other product information reasonably required by the Implementation Trustee and agreed by the CMA.
12.4.1 ‘PCA products’ include:
(a) any PCA whether or not it includes an overdraft facility;
(b) Basic Bank Accounts;
(c) packaged accounts;
(d) reward accounts;
(e) student or graduate accounts;
(f) youth accounts; and
(g) any other product reasonably specified by the Implementation Trustee provided it falls within the terms of reference of the CMA’s retail banking market investigation and the AECs identified and has been agreed upon by the CMA.
12.4.2 ‘BCA products’ include:
(b) Business Overdrafts; and
(c) any other product reasonably specified by the Implementation Trustee provided it falls within the terms of reference of the CMA’s retail banking market investigation and the AECs identified and has been agreed upon by the CMA.
Summary of responses to formal consultation
Back book products: One respondent expressed the view that the ruling of back book products out of the scope of the release of product and reference information from March 2017 could render the remedy ineffective since customers with such products would not be able to compare them with products currently being marketed.
Back book products were excluded from the scope of the release of product and reference information following representations during the informal consultation.
Although back book products are excluded from the product and reference data to be released from March 2017 they are not excluded from the obligation to share transaction data that will be adopted from January 2018. Once these obligations are in force we expect tools to be developed to enable customers to compare the cost of their present account (including back book products) with new ones on the basis of actual and equivalent usage. While there may be benefits from including back book products in the March 2017 release, for example for customers not wishing to share their transaction data, we concluded that the cost of doing so would outweigh the benefits.
Business current account and personal current account pricing analysis
This paper summarises the key factors which affect pricing for PCA and BCA accounts and gives real-world examples based on selected customer profiles across all the major UK banks.
The Open Data standard which went live in March 2017 covered all standard front book accounts for the CMA9 in the UK. The roadmap requires product reference data to be made available. Neither the roadmap nor CMA order specifies the requirements for reference data for back-book products. This proposition considers the use of the same product reference requirements as used front book BCA/PCA. Recent analysis has revealed that there are approx. 72 million PCA and BCA accounts in the UK across the CMA9. Of these, over 8 million are standard back book accounts, and less than 1m are negotiated or bespoke. The OBIE interpretation of this roadmap item is that it is designed to cater for these 8 million standard back book accounts, which were not included in the Mar 2017 release. But accounts with negotiated or bespoke pricing are not covered by the CMA Order.
OBIE has considered real-world use cases to help define the requirements of this roadmap item.
These use cases make no distinction as to whether the PSU’s account is a front book, back book, or indeed negotiated/bespoke. Hence the design of this item should enable ASPSPs (including the CMA9) to cater for back book accounts in order to meet the requirements for the use cases stated above. This design should also allow ASPSPs to cater for customers on negotiated/bespoke accounts, albeit this may be optional for ASPSPs to support.
Version 1 of the Read/Write API specifications includes a ‘products’ endpoint within the Account Information and Transaction API. This allows a TPP (with PSU consent) to access the PSU’s account and retrieve the product ID. This ID can then be used to reference the corresponding product in the open data standard. So for any customers who have a product defined in the open data standard, the requirements and use cases can be met.
The CMA9 are already populating the open data standard for all standard front book PCA and BCA accounts. However this is not the case for standard back book PCA and BCA accounts, and there are several reasons why an ASPSP may not be able to populate the open data standard with back book products:
The combination of these means that the work required to produce and populate the open data standard with back-book products could be significant.
The scope of this roadmap item is to extend the coverage of the existing open data standard as follows:
OBIE has conducted a series of workshops (Product Endpoint Initial Workshop, PCA Workshop & BCA Workshop ) with TPPs and ASPSPs to define the key subset price variables that are most useful for price comparison and can be made available by the ASPSPs. This design is based on a smaller subset of the full PCA and BCA model and is more suited to back book products (see below).
Furthermore, we agreed (see TDA decision 039) that this model would sit in the ‘products’ endpoint for version 2.x of the Read/Write API standard. In combination with the existing product ID, this would allow an ASPSP to support either or both of the following models:
Some ASPSPs will use one model and some may use both, depending on the PSU and the product. In any case, any data provided by the direct model should take precedence.
In both cases, the TPP will need to be a regulated AISP to access the product’s endpoint.
Negotiated/bespoke products are not mandated in release 2. However, the design should cater for these accounts and thus allow ASPSPs to optionally provide the relevant pricing information for PSUs on such accounts.
The following product types are out of scope for this roadmap item:
Some ASPSPs may still have difficulty sourcing/providing detailed pricing information for some (e.g. older) back book products.
Access to the ‘products’ endpoint will only be given to registered and enrolled AISPs (i.e. this is not open data as it relates to the specific product for a defined PSU).
The suitability of the design and data quality to enable comparison/switching will be evaluated in roadmap item P14.
The following metrics will be required to measure adoption: