The UK government has launched the Smart Data Group following passage of the Data (Use and Access) Bill, signalling a major step in extending open banking principles beyond payments to energy, telecoms, retail and more. The initiative, backed by policymakers and industry leaders, seeks to unlock an estimated £28 billion in economic value by enabling consumers to share personal data securely and with clear consent, improving personalised services and seamless switching across sectors.
This is more than regulatory reform – it represents a strategic evolution of the financial services industry. The Smart Data Group, chaired by Paul Scully and steered by open banking pioneers Richard Newman and Clare Ambrosino, brings together policymakers, innovators and established firms to define schemes, set standards and build trusted infrastructure. Its remit includes orchestrating cross-industry collaboration to ensure secure data sharing through interoperable APIs.
For banking and fintech leaders this opens up a wave of opportunities. Retail banks, insurers and wealth managers can leverage transaction data alongside energy or telecom information to offer better credit assessments, tailored insurance plans and consolidated financial advice. Small businesses may gain from faster SME lending and simplified account reconciliation. This smart data model builds upon open banking’s success – 11 million users and billions of monthly API calls – and extends it into “open finance,” encompassing investments, pensions, mortgages and beyond.
However, realising this potential will require balancing innovation with protection. Consumer groups and experts emphasise the need for clear incentives for data-sharing firms, precise definitions of vulnerability, and tightly regulated frameworks to prevent data misuse. Robust consumer consent mechanisms and transparent governance will be essential to maintain trust as smart data expands into more sensitive domains.
Financial service providers must begin evaluating how their technology stacks, data policies and partnerships align with the emerging regulatory landscape. This means designing API-driven services, forging alliances across sectors, and embedding compliance by default. For fintech startups and incumbents ready to integrate banking data with energy, insurance or telecom platforms, there is a chance to build innovative, cross-sector propositions that deliver tangible consumer benefit.