UK Financial Watchdog Says HSBC Breached Open Banking Rule
The U.K.’s Competition and Markets Authority said HSBC UK has breached open banking provisions set out in the Retail Banking Market Investigation.
In a letter dated Thursday (April 28), the financial watchdog said the bank breached the regulations 11 times by “failing to make continuously available accurate, comprehensive and up to date product and service information, through Application Programming Interfaces (APIs), to Third Parties and to comparison tools.”
According to the letter, HSBC breached the order by either failing to publish information or by publishing incorrect information through Open Banking APIs. For example, in one instance, the CMA said the bank omitted the daily fee charge in relation to its Kinetic overdraft.
In other case, the authority said HSBC incorrectly referenced the annual percentage rate (APR) in relation to its Kinetic credit card.
Read more: HSBC Unveils One-Stop Service For Small Business Owners
Launched last year following a beta rollout in 2019, Kinetic is a mobile banking service designed to provide small business owners with a single platform to manage their financial tasks.
“The failure to make accurate, comprehensive and up to date product and service information continuously available may result in consumers taking decisions that they would not have taken if they had access to the correct information,” the letter said. “For example, consumers may have chosen financial products or services which are not best suited to their needs.”
See also: CMA Warns Barclays, Lloyds to Comply With Open Banking Order
The authority added that it is “specifically concerned with the robustness of HSBC’s governance processes,” saying its internal guidance documents were not specific enough to make sure the bank complied with the order.
The letter also noted that HSBC has taken action to end the breaches, including making sure all product information about the Kinetic offering is correct and up to date. Last month, the CMA sent letters to two other major U.K. banks — Barclays and Lloyds — warning them about similar breaches.