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Quick read
In a recently published Department for Business and Trade policy paper, 'Smart Data 2035: the UK's Smart Data Strategy'', the government has laid out its long-term vision to develop a smart data economy in the UK. It plans to build on the momentum of open banking (the first UK smart data scheme) and UK leadership in fintech to take forward data-driven innovation in recognition of the opportunities for smart data to power "growth, Net Zero and more".
The strategy describes smart data as the secure, consented, sharing of customer or business data with authorised third parties.
Under the Data (Use and Access) Act 2025 (DUAA), the government is empowered to implement smart data schemes. The government's target is to establish five or more active smart data schemes by 2030, and 20 or more by 2035. It also intends to "encourage and coordinate" industry-led smart data schemes.
In our blog post, we consider the aspects of the strategy that are particularly relevant to the UK financial services sector.
Initial actions under the strategy
The strategy outlines the actions the government will take between now and 2029 to advance its vision. These actions are grounded in a three-part approach, which we briefly summarise below:
Smart data in sectors
To achieve the greatest impact, the government will prioritise embedding smart data in the UK's eight 'growth-driving sectors' identified in the Modern Industrial Strategy (see our Infrastructure Notes blog post for more information). These priority sectors include:
- Banking: the government is committed to establishing a long-term regulatory framework for open banking under the DUAA. It will consult on the scheme in early 2026 and, subject to consultation outcomes, lay the regulations for open banking "as soon as parliamentary time allows". As set out in the National Payments Vision, oversight will transition to the FCA, ensuring the scheme's continued evolution. In the interim, the FCA is working with industry to establish the Future Entity (expected to be the primary standard-setting body for open banking application programming interfaces (APIs)).
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Finance: building on the FCA roadmap for open finance (expected in March 2026, but not yet published), HM Treasury will set out in summer 2026 the government's next steps for open finance. The FCA's 2025-30 strategy identifies open finance as a priority area, with a focus on small business lending and consumer empowerment. Its Smart Data Accelerator supports experimentation and innovation.
Interoperability between sectors
The government will publish a cross-economy Smart Data Guidebook by early 2027, covering key scheme design decisions and risks, and promoting common best practice and interoperability across sectors. The initial focus will be on the energy, financial services and property sectors.
Other government initiatives to connect across sectors and support progress include:
- Launching a refreshed Smart Data Council led by the Minister for Digital Economy, to serve as a strategic forum for influencing the guidebook and linking sector work to cross-economy developments.
- Leading a programme of research and information-sharing, including work with industry-led data sharing initiatives and groups (e.g. sector councils) to help advance smart data.
- Exploring a multi-sector data-testing environment to enable testing of smart data use-cases, working initially with the FCA to build on its Smart Data Accelerator.
- Progressing work on long-term institutional arrangements for delivery and, where appropriate, regulation of smart data schemes.
Connecting to other data and digitisation programmes
The government plans to coordinate its work on smart data with the progression of other data-related policy initiatives covering areas such as public sector data, the UK’s AI Opportunities Action Plan and digital identity verification services.
Key themes: input sought
Over the coming years, the government will continue to refine the details of its approach to smart data. Although the strategy is not a consultation, it lists a series of themes in respect of which the government particularly welcomes input, such as:
- Sector and use case prioritisation.
- Best practice in scheme design (e.g. for vulnerable and other consumers), and to maximise how effectively the system works for services using data from more than one sector.
- Potential cross-sector innovation support, or data or regulatory sandbox services, and their design.
- Institutional arrangements for implementation bodies and regulatory bodies, within and across sectors.
- Links between smart data and AI adoption and innovation.
Next steps
In terms of tangible next steps for financial services firms, industry should watch out for the government's consultation on the long-term regulatory framework for open banking under the DUAA, the FCA's roadmap for open finance, and HM Treasury's related proposals, which are expected to follow this summer.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
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