Pilot 1 is FaMLy – A powerful financial recommendation engine for families

This is the Pilot 1 – FAME FreCo Assistance Legal Contingency:

During the last two years, the BNPL model illustrates how retailers can use data assets to offer value-added, finance related services to their customers. These services can become very powerful as the amount of collected data from diverse sources grows in an exponential pace. In several cases, data assets are produced by entire data ecosystems operated by the retailers. In these ecosystems, retailers are able to manage, price, and trade data assets, which EmFi providers can use to provide value-added services for customers.

This is the Pilot 1 – FAME FreCo Assistance Tool Guidance:

1) Type of Data: This pilot includes customer socioeconomic data, such as age, salary, and family size, which provide insights into financial background. Transaction Data covers details like transaction dates, amounts, and the number of transactions, reflecting spending and income patterns. Customer behaviour and usage patterns include credit limit usage, withdrawal frequency, and transfer habits.

2) Data Subjects/Owner of the data: The data pertains to customers, specially natural persons.

3) Purpose: The data is used to offer personalized customer recommendations, enhance user experience, and suggest relevant financial products. It also support a “pay later” payment method, enabling deferred payments based on financial behaviour. On this point, the data helps create customer risk profiles.

4) Legal Obligations: The processing and sharing of this data are subject to several key regulations. Under the General Data Protection Regulation (GDPR) the holder must ensure a lawful basis for data processing and sharing, providing transparency to customers. The platform must also adhere to GDPR requirements when handling personal data (if this occurs). Given that the data includes financial information, the Payment Services Directive 2 (PSD2) applies, and in a future, other regulations such as the proposed Payment Services Regulation (PSR) or the Framework on Financial Data Access (FIDA) must be considered. Additionally, when sharing data with the platforms, compliance with the Anti-Money Laundering Directive (AMLD) so this does not facilitate money laundering or illicit financial activities.

5) This analysis has been conducted based on the work completed in D6.4, and the FAME FReCo Assistance Tool has been used for each pilot.

Disclaimer

The FAME regulatory compliance tool has been developed within the context of FAME project and provides a high-level overview of relevant rules to facilitate regulatory compliance. The information provided within this online tool is for informative purposes only, and we cannot guarantee that it will suit your needs. In any case, it does not constitute legal advice, nor does it create or imply the existence of any attorney-client relationship.”