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The ESAs wish to understand what the big data phenomenon means for consumers, the financial industry and regulators. Existing EU legislation on data protection, competition and consumer protection, which shares the common goals of promoting economic growth, innovation and the welfare of individual consumers, are relevant for financial firms while not addressing big data issues explicitly.
The discussion paper asks whether the existing regulatory framework is sufficiently flexible to cover big data, has gaps which need to be filled and how it impacts the use of big data technologies.
A Q&A document provides clarifications on big data, its purpose and application in the financial sector.
Based on ALFI, Big Data tools could be used in a more sophisticated manner than is currently the case, for example in conjunction with artificial intelligence tools to provide advice in the form of ‘roboadvisory’ technology or service or other forms digital investing techniques. These could either provide systematic advisory services or augment the advice that is currently given from wealth and investment management professionals.
A key success factor for a big data strategy is to develop a holistic approach to data management. As well as improving the Client experience, the strategy could also assess the value of Big Data (for example selling analytics or predictive tools to the clients) and identify other ways to lower risks.