Data Bill: landlords using open banking to monitor tenants’ accounts for months, campaign group claims

Open banking allows financial information to be shared with third parties, such as when your Apple Wallet displays the latest transactions from multiple bank accounts. Credit: Adobe/AscannioOpen banking allows financial information to be shared with third parties, such as when your Apple Wallet displays the latest transactions from multiple bank accounts. Credit: Adobe/Ascannio
Open banking allows financial information to be shared with third parties, such as when your Apple Wallet displays the latest transactions from multiple bank accounts. Credit: Adobe/Ascannio | Ascannio - stock.adobe.com
There has been criticism of the Data Protection and Digital Information Bill over the potential access it would give to people's bank accounts.

Landlords are using open banking to secretly monitor their tenants’ bank accounts for up to six months, a campaign group has claimed.

This comes as the government plans to widen the technology to multiple industries through the Data Protection and Digital Information Bill (DPDI Bill). Open banking allows financial information to be shared with third parties, such as when your Apple Wallet displays the latest transactions from multiple bank accounts.

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It’s also used by landlords to carry out affordability checks on prospective renters’ bank accounts. However MedConfidential, an organisation set up to defend privacy around health records, has accused landlords of using the technology to monitor their tenants’ accounts for months

The bill aims to simplify data protection for businesses and reform GDPR, as part of this includes extending open banking across a wider array of industries. However, it has been criticised by campaigners for allowing the state to put people under surveillance without prior suspicion.

MedConfidential has called on the government to put into law a limit on access to tenants’ bank accounts to 24 hours, to block any chance of snooping. The campaign group said: “While Open Banking has many benefits, it is also used by landlords, and the landlord service industry, to do the affordability checks on potential tenants seeking somewhere to live. 

“The design of Open Banking allows those landlords to monitor the bank accounts of tenants for as long as an Open Banking approval lasts (normally six months). While individual landlords may not choose this access if given a free choice, the service industry providing the tenant checking service to landlords is strongly incentivised to maximise the access, otherwise their competitors have a selling point.”

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The group added: “If Open Banking is to be added to the statute book, legislation should mandate that the minimum and default access duration must be no greater than 24 hours, and the offence of an “enforced subject access request” should be extended to being compelled to use open banking for any longer than the minimum access period.”

Housing campaigners have echoed MedConfidential’s call. Tom Darling, of the Renters’ Reform Coalition, said: “Many renters would be alarmed to think that, up to six months after they’ve moved into a property, their estate agent or landlord could access their personal bank accounts and all their transactions. 

“I don't see why it would be necessary for renters to submit to anything more than one-off affordability checks. This is sensitive, private data and I can think of no reason why landlords or estate agents should be able to continue to access it months after the tenancy has been approved. If anyone wants to try to justify this practice, then go ahead - but I suspect that won't be possible and it ought to be scrapped.”

Both the National Residential Landlords Association and the Department of Science, Innovation and Technology, which is bringing forward the bill, declined to comment. This is the latest criticism of the bill’s potential to allow access to bank accounts.

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Today, MPs raised concern that the proposals would allow the Department for Work and Pensions (DWP) to view benefit claimants’ bank accounts for “social security purposes”. Sir Stephen Timms, the Labour chair of the Work and Pensions Select Committee, suggested its remit would go further, allowing ministers to view the banking details of any state pension recipients, whose payments are administered by the DWP.

He said: “This measure will give the government the right to inspect the bank account of anyone who claims a state pension. So all of us actually, every single one of us, this measure will give the government the right to look into our bank account at some point during our lives without suspecting that we have ever done anything wrong, without telling us that they are doing it.”

He added: “What on earth would the government need to do that for? The entitlement to the state pension is not based on income, or savings, or anything like that, so why would the Government ever wish to do that?”

Culture minister Sir John Whittingdale said: “It is specifically about means-related benefit claimants, to ensure they are eligible for the benefits they are currently claiming. In doing that it will save the taxpayer a considerable amount of money from the identification and avoidance of fraud.”

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Ralph Blackburn is NationalWorld’s politics editor based in Westminster, where he gets special access to Parliament, MPs and government briefings. If you liked this article you can follow Ralph on X (Twitter) here and sign up to his free weekly newsletter Politics Uncovered, which brings you the latest analysis and gossip from Westminster every Sunday morning.

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