There is no standard for data sharing between banks and fintechs which often results in screen scraping; this leads to concerns around data security and is also an inefficient way to gather data; the Financial Services Information Sharing and Analysis Center released an updated version of their recommendations around data sharing called the Durable Data API specification; this could eventually become the standard adopted by the industry; American Banker compares this to PSD2 in the UK and shares more about the new specification. Source
According to a new study by Accenture 7 out of 10 consumers would be reluctant to share their Information with third party providers; Citi recently published a study pointing to three main reasons that wide scale adoption will take longer; reasons include slow consumer adoption, fragmented market for new open banking services and the ability for payment providers to adapt to new rules; thus far open banking has been slow but big banks like Lloyds Banking Group and RBS have made big tech investments anticipating the change will happen over time. Source.
U.K. based personal financial management app Emma recently launched in December and has struck data sharing deals with Starling Bank and Monzo; the app also works across 17 banks to screen scrape data as the banks work towards compliance with open banking; Emma is a budgeting app that helps customers avoid overdrafts and sees a big opportunity with the open banking regulations; “We’re building a tech company, and we understand that the data [play] goes beyond just overdrafts — it’s about understanding when certain events happen, money can be saved or invested,” said Emma founder and CEO Edoardo Moreni to TearSheet. Source.
Monzo has added the first batch of partnerships to their marketplace by striking deals with digital wealth investment accounts and online lenders; companies include Scalable Capital, Wealthify, Wealthsimple, WiseAlpha, Zopa, Bricklane.com and Octopus Choice; Monzo will not be making a commission from any of these agreements; the company has also opened up an interim third-party API to comply with open banking regulations. Source.
Lend Academy answers the question: Where does the UK stand after more than two months since the introduction of open banking? Source
According to a report by Which almost 92 percent of consumers have not heard of open banking; slow adoption by banks is one reason for the low numbers; another reason is many people have started to use non bank services for payments or other tasks, the term open banking is still relatively new; banks are starting to innovate, by building or partnering, and open banking will only help to push innovation forward. Source.
HSBC looks to become the first major UK based bank to comply with open banking; the bank plans to launch a new app that centralizes information about customers’ accounts; the current plan is set for release in the first week of May and the app will be named Connected Money; HSBC’s UK head of retail banking and wealth management Stuart Haire said the new challenger banks have been have been making progress on customer insight; there is still healthy skepticism about how fast open banking will catch on as incumbents have been slow to comply. Source.
Savings rates at UK challenger banks are more than 1 percent higher than their high street counterparts; research by challenger Gatehouse Bank revealed the statistics; challenger banks and digital banks are still finding wide knowledge of open banking a challenge; “Sadly too many savers still opt for products from household names as they are unaware of the best buys that exist beyond the high street,“ said Charles Haresnape, CEO of Gatehouse Bank, to AltFi. Source.
Open Banking kicked off in the UK this past January. Thus far we’ve seen slower adoption among traditional banks, a...
Revolut has launched their open API for customers and they have increased their Revolut for Business service; Banking Technology reports that the company said “account owners can generate sandbox and production keys, and set whitelisted IPs as an “extra layer of security”; accounts allow users to send, hold and exchange up to 25 different currencies. Source.