WASHINGTON (Reuters) -The top U.S. watchdog for consumer finance asked a federal court on Tuesday to pause an industry lawsuit seeking to strike down “open banking” regulations adopted by the prior Biden administration so the agency will have time to put forward a new version, court papers showed.

The decision marked a reversal for the Consumer Financial Protection Bureau, which had previously said the court should scrap the regulations, which are intended to give consumers greater control over their own financial data and boost innovation in financial services technology, thereby lowering costs.

“In light of recent events in the marketplace, the bureau has now decided to initiate a new rulemaking to reconsider the rule with a view to substantially revising it and providing a robust justification,” the agency said, adding that it would begin an “accelerated” rulemaking process within three weeks.

Under former President Joe Biden, the CFPB proposed regulations to govern data sharing between fintech firms and traditional banks, allowing consumers to easily transfer their personal data between providers free of charge. Called for under the landmark 2010 Dodd-Frank Wall Street reform legislation, the regulations were also intended to help reduce costs and increase the kinds of services available to consumers.

However the banking industry quickly sued to block aspects of the rule, arguing that it would endanger bank customers’ privacy and the security of their data. The fintech industry said to the contrary it offered security protections and that scrapping the rule would be a handout to large banks that hampers competition. The CFPB had told the court in May it believed the regulations exceeded the agency’s legal authorities and should be scrapped.

(Reporting by Douglas Gillison in Washington; Editing by Chris Reese and Andrea Ricci)