EBA issues Opinion in response to the European Commission’s proposed amendments to the draft technical standards on crowdfunding service providers

The European Banking Authority (EBA) published today an Opinion on the amendments proposed by the European Commission to the EBA final draft Regulatory Technical Standards (RTS) on requirements on credit scoring of crowdfunding projects, pricing of crowdfunding offers, and risk management policies and procedures. In the Opinion, while accepting the change proposed by the Commission on the treatment of personal data, the EBA notes the importance of ensuring that crowdfunding providers can access historical data to improve the assessment of creditworthiness and the performance of their scoring models.

The European Commission’s version of the RTS, compared to the final draft RTS submitted by the EBA on 10 May 2022, includes one substantive change, with regard to the treatment of personal data included in the documentation related to the creditworthiness assessment of perspective project owners. Following the comments received by the European Data Protection Supervisor, the Commission proposed an amendment to require that personal data included in that documentation shall be kept for a limited period of time (no longer than five years) after the repayment of the final installment of the loan.

In its Opinion, the EBA recognises the importance of treating personal data in accordance with the “storage limitation” principle established under Article 5(1) of the General Data Protection Regulation (EU) 2016/679 (‘GDPR’) and, therefore, accepts the proposed amendment. The EBA also notes that the amendment does not prejudice the specific objective in the RTS of ensuring that crowdfunding providers can access historical data for the purpose of improving the assessment of creditworthiness and the performance of their scoring models.

Legal basis and background

This Opinion is based on Article 10(1) of Regulation (EU) No 1093/2010 (‘EBA Regulation’), which requires the Authority to submit its response in the form of an opinion to amendments proposed by the European Commission.

On 10 May 2022 the EBA submitted its final draft RTS and on 2 May 2023, the EC sent a letter to the EBA about its intention to endorse the RTS with amendments and submitted a modified version of the RTS.