Consumer Willingness to Share Payments Data: Trust for Sale?

Abstract

The revised Payment Services Directive (PSD2) has opened the possibility for third parties to accessconsumers’ payment account in order to use their payments data. Such third-party access to data is a novum in network regulation. Its success depends on consumer preferences concerning the usage of this data. We study these preferences using a representative panel of Dutch consumers. In particular, we consider how consumer willingness to allow access to payments data depends on: (i) the type of data user: consumers’ own bank, another bank, or a BigTech; (ii) financial incentives; and (iii) trust in the data user. We research attitudes in case of a financial overview, a mortgage loan and a personal loan and obtain the following results. First, willingness to allow access is highest if the user is the consumer’s own bank. This holds irrespective of the type of service and the financial product. Second, the propensity to use account information services is driven by consumers’ trust in the providers of these services. Third, an explicit financial reward can tempt people to accept offers from other providers. BigTechs need to offer stronger incentives than other banks, because people trust them the least.

Keywords: consumers, discrete choice models, PSD2, retail payments, trust, pricing

JEL Classification: C25, D12, E42, G21, G24, G28