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So we sometimes, see privacy as a bipartisan issue and it can be. But, recently with consumer privacy, it hasn't been, so much of a bipartisan issue. We've seen a lot of, partisan, disagreement. And so there's been some gridlock on the federal level. And so we're also seeing that people actually really want privacy. What? I know. It's crazy. And so, states as they normally do, and there's an absence of action on the federal level, are stepping in, to try and give their residents privacy protections.

Yeah. So so one pro is that, states can sometimes sometimes act a little more, quickly. Things tend to happen more quickly, on the state level, and so they can respond more quickly to, what, their constituents are are telling them and and what, privacy protections are needed. Needed. And they can also, sometimes set, they can experiment a little more and and set a a higher standard for privacy, than we've had on the on the federal level and we haven't had, you know, really strong privacy rules on the federal level. Ever. Yeah. And, some of the cons obviously, it is harder for everyone to have multiple different standards to comply with in in different states. That's probably the main con.

Yeah. So, I was actually here on the podcast,

It was, we were talking about the victory that was the the FCC Broadband Privacy Rules. The FCC gave consumers, pretty strong, very thoughtful, protections for their privacy when they are, using their broadband connection to, surf the web. And, unfortunately, a few months later, Congress used a little known tool called the, Congressional Review Act to reverse the rules. That sort of left a gap in protections, that states have been trying to step up and fill. And, a couple states that we've seen, with very thoughtful and and strong attempts at that, Washington is one, Massachusetts is another. But really, we've seen, you know, dozens of states either have, a bill introduced or,

So so one area, that's sort of, controversial right now is, expanding the protections we're seeing, states trying to to push through for broadband providers extended to what we call edge providers. So like the the Google's and other Internet services of the world, and that gets into more complicated territory. We definitely think that there should be, strong privacy legislation that applies to everyone on the federal level. But in the absence of that, I do think states are going to, come into this space. And I I guess another area would be, data security. And we're also seeing that come up in the in the broadband context. The FCC rules had a data security component that a lot of states are adopting. And that's also a place where, standards on the federal level, have been fairly flexible, which is not necessarily a bad thing, but it is an area where states can start to, experiment with with higher standards and more specific standards. Alright. Well, oh, Vijay, you have more to add, please. Yeah. I I think one other area that we're just seeing to pop up now, are these right to know bills. Right to know comes from the, actually, the,

the best and easiest way to think about Yodlee is as the intermediary between fintech and the traditional banking sector. We're about twenty years old. So we're one of the first fintech companies out there. And the business case is when you, the consumer, a small business wants to use a fintech platform but wanna connect your bank, and the average American average American has about 15 different bank or payment accounts at seven different Wow. I'm below average, I think, now. So that's good. The idea is that we can connect those two. So screenless data capture is one way of connecting those two. That's where we, get the user's credentials, so username and password, and log in as them to capture the data and use it for the third party application. But only about 25% of our data comes from screenless data capture. The vast, vast, vast majority of our data comes from what we call direct feeds. So Yodlee's differentiator in the market is we've negotiated bilateral deals with hundreds, maybe thousands of different data sources so that we have direct connections to those banks where we don't need the username and password to access the data. We have prenegotiated contractual agreements to get that data instead. And are those, stronger when it turn comes to privacy and security if it you have those agreements? Privacy and security is always of paramount importance, right, for all the players in this ecosystem. So it's regardless of how we get the data, those are absolutely fundamental. We are regulated and supervised by the OCC. We're examined, because we're a third party vendor to so many large financial institutions, and we have a really, really, really strong, risk and,

So what's changed is the immense number of offerings of products and services from technology companies in the financial world. As that's happened, we've also seen the, tenor and tone of the banks change as it relates to allowing their consumers to share this data. Okay. Part of it is from a security perspective to the point I think you alluded to earlier. Right? There are legitimate security concerns that banks have, both data and cybersecurity, about allowing these third party tools to leverage consumers' data to provide benefits to them. But part of it, frankly, is just competition. Right? So in many cases, fintech firms are competing directly against traditional banks to offer the same types of products and services that banks historically have provided for centuries. And so some of these products and services just for people? Everything. Right? So it it ranges from personal financial management tools. So, you know, you go along, you see a dashboard of all 15 of your accounts in one place. Your entire financial life is there. To, credit and lending products. Right? Think about your marketplace lenders or, our firms like Kabbage for small businesses and getting credit for them. To there are even applications now that can help you, mediate your way through a divorce. So if you can aggregate all of your finances in one place, you can all see it in one place, and then you can decide how to divide up. There are literally thousands and thousands and thousands of applications. The beauty is it's up to the consumer to decide which they want to use, and their data only comes in once they've said, yep. I'm gonna log on to, let's say, Personal Capital or Betterment. I wanna use this tool, and only then will the connection to their financial accounts be made once they input the information.

four five is connecting a Capital One account to use personal capital. But even if that wasn't the case and there's a breach, for Yodlee, there's a few different things that mandate who's liable. The first is where did the breach actually happen? Right? If if it happened at Yodlee Sure. That's one scenario. If it happened at the bank, that's another scenario. If it happened to third party, personal capital, that's a third scenario. But because we're a little bit different, right, I went going back to the idea that three quarters of our data comes through direct fees and contractual relationships with with banks, each of those contracts stipulates the liabilities. Okay. So it's a little bit different for Yieldy than the rest of the players. The differential for us is that we have those relationships with banks. The majority of other players in the system, or at least most of the other players in the system, go through screenless data capture. So it's less collaborative with the banks, and it's more you give us your username and password. We will log in as you to your account. We will capture it, and we will spit it out. It's not less safe. It's a different form of doing it. But because we have the contractual arrangements, the liability provisions are clearly spelled out in each scenario. Okay.

rules, regulations, policies around privacy. Yeah. So this this is a fascinating area. Right? And it was one that was really eye opening for me having come from the traditional bank world and done a little bit of work in the EU to now being really, really deeply involved in what's happening there. Generally speaking, we in The US are years behind the EU, in terms of thinking about data and privacy and how consumers can use their data to their advantage. In the EU, there are two, regulations that I would point out as really important. One is the second payment services directive, PSD two, which the European Banking Authority just finalized some of the standards a few weeks ago. And in the next couple of years, we'll go into full effect. The idea here is consumers own their own data. It's not the banks to decide what to do with. It's the consumers to decide what to do with. And it goes through a really, really descriptive and, prescriptive mandate into how banks must make the data available and what the roles and responsibilities in ecosystem are, you know, going back to your question about liability and how the data is collected, all of these things. But at the core is technology is a really important way that consumers can improve their finances, and banks should not stand in the way of allowing consumers to do that. The second I would say is GDPR, which is the data security European requirement, which is also gonna go into effect the next year and a half, year or so. And that's kind of the other side of the coin of PST two. It's this idea that in a really tech focused world where consumers are permissioning and using their data for any host of things, not just in the financial world, everywhere, there have to be some baseline understandings about data security, data privacy, consent, disclosure, and, letting consumers turn on and off the ability to use the data so that the flow they have control of the flow. It's not somebody doing it for them. Yeah. So those two things intertwined, create a really important fabric for how this environment should work, the fintech environment should work in the EU. And then you have other countries in the EU, well, I I suppose The UK is one foot in, one foot out, that even gone a step further and said, not only will we take these and implement them, we're gonna go a step further and have something called open banking, where we will create a standardized API by which all of this data has to be made available so the consumer can not only permission their data, but there's a standardized way that these fintech firms can get the data so that we are getting rid of all the drag in the system, and it's frictionless for the consumer. Contrast that to The US, right, where we have a really fragmented regulatory system that came about after two and a half centuries of securities laws and bank laws and technology laws and privacy laws. We also have 6,000 financial institutions in this country as opposed to a few dozen in Europe. It's really hard to get consensus here. And the regulators in The US and congress are really wrestling with what is our role here in the first place. And even if we have a role, we have to, I I, recognize that it's just a sliver of the entire ecosystem, which means it's kind of been a free for all. Right? The the market itself has been dictating the terms here. What we're seeing now is increasingly, financial institutions are recognizing fintech as competition, and they have the right here to say what data they will and will not share. Contrast it to the EU where they don't have that right, it means that it's a much more friction full Sure. Experience Yeah. For the consumer here, which is why Yodlee and 20 or so other, fintech companies, we call ourselves the, Consumer Financial Data Rights Coalition, are really evangelical about this idea that it's not the bank's data to decide whether to share or not. It's the consumers. And in an environment like in Europe, like in The UK, where consumers have the right to share their data to these technology tools, they can really take advantage of important, important, important, tools that can help them improve their financial well-being.

underwriting, if they can take their transactional information and leverage it as another tool beyond just a credit score to get better pricing on credit products. The OCC, of course, has its proposed fintech charter, which is trying to bring into, preempted federal state supervision of, fintech, firms that are involved in bank type services. The FDIC, the OCC, and the Fed came out with a cybersecurity ANPR, late last year, early this year, which is really on cybersecurity, but has a whole section on what they call external dependencies, which is really fintech. So they're starting. And in the Hill, we've seen the innovation initiatives from, congressman McHenry and congressman McCarthy, which is all about trying to really grow the innovation that's happening in fintech and make it more available, both from a how do you finance it at the front end to how do you use APIs to to exponentially grow it. So they're starting. How this all ends up, of course, is still very much unknown. It will take years at this pace to get to, you know, any type of finality. And even then, as I said earlier, you've got 6,000 financial institutions in The US. You've got thousands and thousands of fintech players, aggregators like Yodlee who sit in the middle. It's not clear to us that you will get any cut and dry rules like we have in the EU, like PSTT or GDPR. But instead, what we think is if you just get to a place where it can be asserted that the consumer has the absolute right to share their data, the market can figure the rest of it out. Right? We've been doing this for twenty years. In the absence of all of that regulation Right. We can keep doing it. The only difference here is we need to make sure that the consumer's rights to their data are unfettered. That's great.

So tools that, can smooth income for seasonal workers or for low income workers who don't have a dependable paycheck. But if you have a year or two years of transaction data that shows, direct deposit into your account rather than have to figure out, do you pay the phone bill this month or the electricity bill or the rent or, you know, your kid's, tuition? They will say, we'll give you a dependable amount every two months or every month in your paycheck. It will equal over a year to what you will take home anyway, but it's smooth. So you will not have to make those choices every year. So there's a host of applications like that, fixed income optimization tools. Right? I alluded to the divorce reconciliation tool. It's it's limitless, really, when you think about it. It's and the the beauty of it is it's all dependent on a really, generally, simple transaction data that you have at your fingertips now. And, theoretically, you could have just printed out, right, and done with it, you know, in an Excel spreadsheet, kind of all this stuff on your own. But the ability to put it in categorized form, in dashboards, and to dice it and slice it and apply analytics to it empowers all of these tools to help you make sense of your finances. That's great. Yeah. No. I am I'm no Excel expert. So, you know, that that Excel solution is never a good one. Anything that makes it easier is better. I think the data that we have shows that before fintech, only about 2% of people actually had budgeting tools that they could track all their finances across all of the accounts that they had. So there's a huge, huge, huge benefit to this. Absolutely. Well, there are definitely a lot of potential benefits and some risks out there. So, hopefully, all sectors come together, figure this out. Steve, thank you so much for sharing your insights and being on Tech Talk. Thanks for having me.