Ian Matthews looks at the progress of open banking one year on.
Whether it’s the War of the Currents or the battle between Betamax and VHS, we all know what happens when two or more players fight it out to have their technology recognised as the global standard: one wins, and the other fades into the footnotes of history. But what happens when a new, open standard is applied to an age-old industry like banking?
Not very much, as it turns out – at least, not yet.
Next week sees the first anniversary of open banking across the UK, an initiative designed to enable financial providers to build new services based on access to customers’ banking information. In spite of open banking being launched amid great fanfare, just 22 per cent of UK consumers have so far heard of the standard, while just 9 per cent of people have used open banking services.
Open banking wouldn’t be the first technological initiative to suffer a slow uptake, and the banks themselves don’t seem to be too worried about the current lack of public awareness. Financial law specialists TLT recently found that well over four in five of the UK’s financial companies are investing in open banking products and services, while more 77 per cent say that the initiative represents one of the most radical changes in the financial services within memory.
This presents a once-in-a-generation opportunity for financial businesses of every size and stripe – but only if they can seize the opportunity to deliver services that are meaningful to individual customers. And that requires a completely fresh approach to data.
