Although Open Banking services have been available in the UK for nearly two years, it’s fair to say the initial period after launch was something of a slow burner. With appetites for these services initially being tempered with a healthy dose of caution.
However, the initiative has started to gain traction in the last 12 months. And we’ve seen several exciting personal finance management tools emerge, helping people manage their money more effectively with additional insight provided.
Recent figures from the Open Banking Implementation Entity (OBIE) are also encouraging. We’ve seen a marked increase in the number of people embracing a new wave of apps and services to help manage their money or share bank account transaction data to improve
access to finance.
In June, there were 66.7 million API requests, more than double the 26.9 million recorded in February. An API request is an essential part of the data sharing process as it ensures that customer data is up-to-date when they initially consent to share their
information, and for ongoing requests.
Open Banking may still be in its infancy, but we are starting to see a steady flow of new open data driven services become available, including apps allowing you to show all your financial account information in one place, to finance providers, rental property
agencies and gaming companies better assessing whether products are affordable for their customers.
This is just the beginning though.In the future, Open Banking data could be used alongside an applicant’s credit history to offer lenders a positive view of an applicant’s income and expenditure as part of their financial track record.
Advances in open data technology will also allow more people to use their information to access improved services which are tailored to their needs. It’s these enhanced capabilities – combining consumer contributed data with other sources, such as the credit
bureau – which will allow companies to interact with people in new and more meaningful ways.
While Open Banking has the potential to be transformative in the way we all engage with our personal finances, it’s also fundamental we address more trust in the process of sharing data in this way and develop more industry-wide confidence in the practice
of open data sharing, to take advantage of the opportunities that it brings.
Helping people and businesses to understand the value of their data and realise the benefits is instrumental in really driving Open Banking to become more commonplace, ultimately delivering better and quicker outcomes for how people can move, manage and
make the most of their money.