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Money 20/20 Europe 2019 Q&A: Deutsche Bank’s Joris Hensen

Money 20/20 Europe 2019 Q&A: Deutsche Bank’s Joris Hensen

After taking part in the F’in debate on transforming traditional banks to compete in the digital banking battlefield at Money 20/20 Europe 2019 in Amsterdam, Finextra spoke to Joris Hensen, co-lead API program at Deutsche Bank AG, about their developer portal, data aggregation and open banking.

What apps and services have already been built based on Deutsche Bank API?

Over 2,500 developers are now registered on our developer portal and 16 partner applications are in live operation. For example, the Frankfurt-based fintech dwins developed a mobile app called Finanzguru that empowers customers to easily manage their finances and contracts.

Another partner is Buhl, a Germany-based company which is leading in software for personal tax declarations. By connecting to dbAPI, Buhl is able to automate large parts of a user’s tax declarations and thus provides an extraordinary user experience.

Beside B2C applications we also connect multipliers with dbAPI such as madco, an e-commerce agency which develops plug-ins for online shops. In addition, business customers can connect their business applications to dbAPI for real-time access to their business bank account.

Why did Deutsche Bank decide to open up earlier and beyond the scope of regulatory requirements? What is the difference between PSD2 and Deutsche Bank API?

A long time before PSD2 became a thing, we already realised that open banking is a huge opportunity for us as a bank. That's why we opened up much earlier than required by regulation.

It’s also important to mention that Deutsche Bank API goes far beyond the scope of PSD2 when it comes to the data that you can get. For example, we offer credit card data or investment portfolio data which is not included in PSD2. Whenever a company contacts us to obtain data or a banking service that we do not yet offer through the API, we will look into it. That's the beauty of being ahead of regulation. We can decide where to grow and what to offer.

While many banks in Europe will not start until the deadline in September 2019, we can already look back on around three years of open banking practice. We act out of conviction and based on our own open banking strategy, not due to regulatory constraints. That's why we not only opened up to third parties earlier and more extensively, but also invested a lot of time and energy in close cooperation with our partners. For us, the essential question is: what can we do to attract the best partners?

Now that larger financial institutions have launched their own data aggregation services, are customers better able to communicate with their bank?

Open banking strengthens our customers’ data sovereignty. This means that it has never been so easy to quickly and intelligently leverage the potential of one’s personal banking data in a whole new variety of situations, even beyond banking. So, open banking is not so much about communicating with your bank but rather interacting with your banking data in new contexts. And in that regard we will continue to see huge progress over the next couple of years.

How can third party providers (e.g. startups/fintechs) innovate and grow by leveraging banking data from incumbents?

The high quality of customer banking data has huge potential to streamline and personalise the user experience of already existing applications. Plus, the use of such data is not limited to solutions related to payments but can greatly simplify and accelerate processes such as verification of a person’s age, ID or solvency.

On the other hand, dbAPI not only gives you access to data but also the opportunity to access Deutsche Bank's high customer reach. Fintechs and start-ups in other industries can offer the bank's customers their own apps and services and thus accelerate their growth.

What is the commercial opportunity to be gained from open banking?

We launched dbAPI to facilitate connections between Deutsche Bank and potential partners such as startups, fintechs and established companies. By enabling external partners to build and offer apps and services for our customers, we are increasing our relevance for the individual client. Thus, the bank is transforming into a modern companion in all situations and at the same time increasing its attractiveness for new customers and - as a result - for additional external partners. In addition, we see a future potential in fees for access to data and services, thus creating new revenue streams.

How is the SME community benefitting from open banking?

There are two things that most small and medium enterprises lack: quick and easy access to a large customer base in order to grow their business and high-quality data to personalise and streamline their digital applications and services.

We can offer both: Deutsche Bank API enables small and medium businesses to offer their apps and services to millions of Deutsche Bank customers. Furthermore, dbAPI also offers access to high quality data which enables you to build highly customised and tailored solutions.

What are the key trends in open banking for 2020 and beyond?

Even though open banking as a concept has been around for quite a few years now, I think we are still in a very early stage. All parties involved - from banks to companies to customers - are still acting reluctantly. We will continue to see a lot of small-scale experiments until one case with scale and impact will accelerate the movement. At this point, I wouldn't bet which industry will bring this case. But perhaps the more interesting question is, will it be in B2C or B2B?

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