First of all, if you're not aware of Data Privacy Day, it's probably a good place to start by defining what it is:
The purpose of Data Privacy Day is to raise awareness and promote privacy and data protection best practices. It is currently observed in the United States, Canada, Israel and 47 European countries.
It's been running since 2006 and takes place on the same date each year - 28th January.
Data Privacy for Fin-tech
So now we know what it is, it's important we do our bit by providing some insights into Data Privacy for those in the Fin-tech sector.
As we know, the Fin-tech sector is one of the biggest changing industries as more and more companies are now becoming more adventurous with their business ventures and this also includes smaller companies taking on big data to disrupt the market.
But this has certain implications for data privacy.
Much like everyone else, those working in the Fin-tech sector have the big consideration of GDPR to think about on Data Privacy Day.
Some would say this is the benchmark for data protection today considering the impact it had on the marketing and data sectors early in 2018.
Fintech offers clear opportunity for a new, more efficient, effective, and – dare I say – human approach to finance, but it can also represent hidden risk - see Revolut's involvement in a dispute in 2018 over money laundering claims and non compliance.
Digital Only Banking
Building on from GDPR, digital banking or 'digibanks' as the key proponents such as Revolut, Monzo and Starling are considered are taking over the banking world.
P2P transfers and a digital only landscape means that the fin-tech industry is not only at the heart of this movement, but also needs to be ready for changes in 2020.
Importantly, CACI says 42% of high-income professionals will be moving away from desktop banking to mobile channels within the next five years.
The rise of these online banks has brought to light the importance of data privacy especially for Fin-tech companies.
Blockchain has become a growing aspect of ensuring that all data is transparent and has become the go to tool for Fin-tech companies to utilise in easing data protection concerns in 2020.
Forbes defined Blockchain as:
'a special immutable computer file that is decentralised and distributed, is disrupting financial institutions.'
And this has many implications on the Fin-tech industry in 2020. Blockchain is essentially the new combatant of banking and digital fraud. Estimated to reach $6,700m in the US by 2023.
In simple terms, Blockchain is the technology that underpins digital currency (Bitcoin, Litecoin, Ethereum, and the like). The tech allows digital information to be distributed, but not copied.
Finally, with the tightening of laws under GDPR comes stringent sanctions for anyone who doesn't comply with the rules around data protection.
No less important on any other day, however on Data Privacy Day it's vital that the consequences of complying with data law is recongised - no more so than in the booming Fin-tech industry.
The fines and sanctions imposed on big companies can be as high as €20 million, or 4 per cent of their overall turnover.
Fines for minor offences, such as not keeping records in order or failing to notify the supervisory authorities, will be set at 2 per cent of the overall turnover.
With so much digital information available for Fintech firms to use and analyse, it is imperative that regulatory bodies like the FCA continue to question how Big Data is being used. A big advocate of this is the continued promotion of Data Privacy Day.