America’s financial system has always thrived on a delicate balance between innovation and security, freedom and fairness, and competition and consumer protection. That balance is what President Donald Trump‘s open banking initiative seeks to restore.
This week, the comment period concluded for the rulemaking process that will set new, clear guidelines for how consumers control their data and utilize the apps, financial technologies, and tools and services that make their lives easier and their financial futures more secure. I was pleased to submit a comment outlining the priorities I believe the Consumer Financial Protection Bureau should consider in its rulemaking process.
During my time at the CFPB, I saw firsthand the Trump administration’s early work to bring that vision to life through Section 1033 of the Dodd–Frank Act. That provision requires the CFPB to write rules giving consumers access to their financial data. From 2018 onward, the goal was clear: protect consumers, encourage innovation, and hold big banks accountable without stifling competition.
THE CASE AGAINST THE CFPB’S OPEN BANKING RULE
But the rule was never finished before the 2020 election. The Biden administration inherited the effort and promptly derailed it.
The Biden-era CFPB issued a “final rule” on open banking in October 2024 that turned a promising blueprint into a regulatory mess. Instead of empowering consumers, it empowered bureaucrats. Instead of creating competition, it strengthened bank consolidation. And instead of protecting privacy, it opened the door to government overreach.
The result? The biggest banks saw an opportunity. Within days, they launched lawsuits to block the rule entirely. Courts quickly found that the Biden version exceeded the CFPB’s statutory authority, and the rule has been tangled in litigation ever since.
That’s the mess Trump inherited and is now determined to fix.
Under the leadership of CFPB acting Director Russell Vought, the bureau has moved to vacate former President Joe Biden’s flawed rule and restart the process. This is more than a bureaucratic cleanup. It’s a rescue mission to restore Americans’ access to their financial data and revive the innovative spirit that drives our economy.
The stakes couldn’t be higher. Open banking is not just about convenience — it’s about freedom. It ensures that consumers can take their business elsewhere if banks cut them off for political reasons. It encourages competition among financial innovators, from digital wallets like Venmo to emerging cryptocurrency platforms. And it lays the foundation for America to become the global capital of financial technology and crypto, one of Trump’s stated goals.
The need for this freedom isn’t theoretical. After the 2020 election, major financial institutions severed ties with the Trump family and other conservative figures, forcing them to move funds into smaller banks and even cryptocurrencies. Millions of Americans saw similar “debanking” incidents for political or ideological reasons. A truly open banking system prevents that kind of abuse by giving people the power to move their money easily and safely.
Of course, big banks hate the idea. JPMorganChase and others have lobbied and litigated relentlessly to stop open banking, threatening punitive fees for data-sharing platforms and fintech competitors. Their strategy is clear: if consumers can’t easily share their data, the banks keep their monopolies intact.
That’s why getting Rule 1033 right matters. The CFPB’s renewed rulemaking process should be guided by three principles:
- Protect competition: Fintech companies must be free to serve consumers without fear of punitive bank fees or gatekeeping.
- Clarify partnerships: The rule should define how banks and tech firms share data transparently and securely.
- Ensure fairness: Consumers deserve low-cost access to their data, while banks deserve clear, consistent standards — not special protection from competition.
Broadly defining “consumers” to allow users to designate properly authorized third parties to access their accounts and transaction data is a critical step. Limiting consumers’ ability to utilize these tools would only empower big bank gatekeeping.
Critics claim open banking creates cybersecurity risks. That’s a red herring. Banks already share massive amounts of data with third-party vendors, payment networks, and cloud providers. Modern fintech firms use state-of-the-art protections such as API connections, tokenization, and encryption, which are far more secure than the outdated systems many large banks still rely on.
None of this means banks must bear unfair costs. A balanced rule can safeguard innovation without punishing incumbents. But what it cannot do is let the biggest banks dictate the rules of competition or deny Americans control over their financial lives.
When Congress passed Section 1033, it didn’t envision a system where Wall Street or Washington, D.C., decides how you manage your money. It envisioned a free, competitive, and transparent financial marketplace that rewards innovation and puts consumers in charge.
TRUMP’S OPEN BANKING RULE IS NEEDED TO PROTECT RELIGIOUS LIBERTY
Trump’s new CFPB team understands that mission. By rebooting open banking, they can deliver a lasting framework that fuels innovation, protects privacy, and ensures that America, not Europe or China, leads the next era of financial technology.
The alternative is a financial system in which banks build walls, bureaucrats pick winners, and consumers lose. Trump’s open banking rescue is about tearing down those walls and restoring the freedom, competition, and choice that define the American economy.
John Czwartacki is a former CFPB official and co-founder and principal at Public Policy Solutions.
