The UK's largest nine banks have been given a year to develop and adopt an Open Banking API interface for customer data sharing in a final order by the Competition and Markets Authority.
In its final report on the retail banking market published last year, the CMA announced a package of reforms designed to shake-up the industry and inject new competition into the sector.
The report was viewed with some disdain by fintech community and new entrants, who bemoaned the failure of the watchdog to impose tougher sanctions to break the stranglehold of the UK's top banks.
Today’s final order sets out the timetable for introducing key advances such as open banking, the monthly maximum unarranged overdraft charge, standardised business current account opening procedures, and banks having to publish service quality statistics.
Alasdair Smith, chairman of the retail banking investigation, says: "Open Banking will make a transformational change to banking for personal customers and small businesses. For the first time innovative and secure apps will provide personalised services and information to cover all financial needs in one place, and make it easy for people to find out what bank account is best for them."
Key dates in the implementation of the reforms include the launch of the Open Up Challenge run by independent charity body Nesta later this month, the first stage of the Open Banking read-only data release in March and a maximum monthly charge on unarranged overdrafts coming into force in August.
Lawrence Wintermeyer, CEO of Innovative Finance says the competition body and UK Government need to work hand in hand to ensure no back-tracking by the banks as they implement the plans.
"The Open Bank Implementation Entity, a group tasked by the CMA to take forward this work, must work with the broadest number of fintech providers, not just the banks to deliver real innovation for the consumer," he says. "HMT must also play an active role in the implementation of the order to ensure it is delivered on time and works for consumers."