Open banking slow burn means just 22% of consumers have heard of the concept

Open banking slow burn means just 22% of consumers have heard of the concept

LendIt Europe 2018 welcomed fintech enthusiasts who attended fireside chats and panel discussions on subjects such as financial inclusion, regulatory innovation and identity before coming on to the hotly debated topic of open banking.

Helene Panzarino from SBC Collab Fintech called into question why there had been such little hype after the launch of open banking on 13th January 2018 and whether what was deemed to be a major milestone for the industry at the time, may have been the “revolution that never was” – as a recent Independent article stated.

Shefali Roy from TrueLayer agreed that enough had not been done in to inform the end user. Statistics released today by Splendid Unlimited revealed that while 9% of adults in the UK have used an app or service that uses APIs, just 22% have heard of open banking as a concept.

The introduction of open banking appears not to have increased trust in financial services with 26% of the Splendid Unlimited poll believing that the concept is merely a meand for banks to share customer data.

EY’s Imran Gulamhuseinwala advised that the 2018 launch was just “the first chapter in the revolution” and it was always intended on being mapped out across a period of 18 months. He also reminded the audience that it is important to remember that what the UK attempted has never been done before. “Ensuring that all banks work together is possible, but it is just the starting gun,” Gulamhuseinwala said.

While the EY representative said that “banks have done a valiant job”, Roy rubbished these claims and pointed out that financial institutions have taken their time to implement APIs as part of their processes and when they have, the quality has not been great.

Roy also suggested that banks are now playing catch up and Gulamhuseinwala backed this by saying that at first banks were in denial, but because “compliance is the best funded business department in a bank”, ihigh street banks have at least been able to push forward with open banking initiatives.

Tim Sievers from Deposit Solutions added that “incumbents will not be the losers” and amid skepticism towards challengers, customers will continue to leverage the long-standing relationship they have had with their banks.

Comments: (1)

Ketharaman Swaminathan
Ketharaman Swaminathan - GTM360 Marketing Solutions - Pune 20 November, 2018, 18:30Be the first to give this comment the thumbs up 0 likes

TPPs shouldn't be freeloaders. If they want to benefit from the data, they should think about how they'd compensate banking customers who provide that data. After the FB-CA fracas, former carrots like targeted offers, superior CX won't work. If TPPs pay for data more directly as I'd highlighted in Open Banking Needs A Blockchain Boost, I predict that the awareness and adoption of Open Banking will hit the next level.