Fidelity National Information Services Inc. uses distributed ledger technology to help ensure compliance with the European Union’s tougher rules about data collection and customer information, Andrew Hewitt, FIS’s director of payment and data solutions, said in a phone interview with Bloomberg News.
Those rules, the General Data Protection Regulation, are set to start May 25. FIS can deploy distributed ledger technology to help companies track what permissions have been given for which data. A distributed ledger means a company can “know absolutely, at any point in time,” about its data, in case a regulator comes calling, Hewitt said. He sees FIS’s product as being blockchain-compatible by the third quarter.
Companies are bracing for GDPR, which will exert broad, hard-to-know influence across sectors. Bloomberg Intelligence analyst Tamlin Bason said he expects “significant to moderate impacts” in numerous areas, particularly in tech and financial services.
“We all wait with baited breath for the 25th, to see what regulators will do,” Hewitt said. Any institution holding the personal data of European citizens should be concerned, he said, as the laws are extraterritorial. That means any bank with any customers in Europe is liable. Fines as high as $24.8 million, or 4 percent of annual worldwide revenue, whichever is higher, are “significant,” he added.
When it comes to financial institutions, Hewitt said banks that are at least trying to prepare for the rules will be viewed “favorably” by regulators. “Those who do nothing are right to be wary,” he said.
And he sees some requirements, such as querying customers about specific areas — for example, whether they’re interested in mortgages — as potentially helpful for targeting marketing efforts and boosting the quality of leads. The more “progressive” banks are seeing the potential to “empower” customers by showing them what data they have, Hewitt said.
Regulatory shifts — including capital levels, the necessity of software for reporting, and Dodd-Frank compliance/implementation costs — were driving change across the financial sector, FIS CEO Gary Norcross said in October, adding that GDPR rules were “very, very difficult to implement.”
©2018 Bloomberg L.P. All rights reserved. Used with permission