Marking the fourth anniversary of PSD2 becoming a regulatory requirement across the EU, the UK’s Open Banking Implementation Entity (OBIE) has issued a statement citing substantial adoption of the initiative across 3.9 million consumers and 600,000 small businesses.
With a 60% increase from 2.8 million users in December 2020, the OBIE also revealed that one million new users are added every six months and by the end of 2021, over 26.6 million open banking payments had been made - an increase of over 500% in just 12 months.
This growth can be attributed to changes in early 2021 that led to HM Revenue & Customs (HMRC) becoming the first Government department in the world to allow users to make open banking payments. Today, over £2.4 billion has been made using this method, significantly minimising the risk of fraud and customer error when making payments.
2021 also saw the CMA ruling in favour of the OBIE’s recommendation to mandate Variable Recurring Payments (VRPs) as the mechanism for implementing Sweeping in July, which has been covered in this Finextra long read.
Charlotte Crosswell, chair and trustee, OBIE said: “The progress made by the entire industry during the past four years to make open banking in the UK a success has been astounding. I’m proud of the contribution that the OBIE has made, enabling and supporting ground-breaking financial innovation and collaboration across the sector. This wouldn’t have happened without a strong regulatory framework and forward-thinking policy makers to support our work. We have set a high standard in the UK, inspiring many other markets to follow our lead.
"Ultimately, I’m delighted that we are beginning to see how open banking is giving people more control over their money. The pandemic has changed consumer behaviour, with an increase in the use of digital and financial services. We continue to see customer growth alongside new and exciting products, and as even more are introduced into the market, open banking will become increasingly mainstream. That will be key to taking user adoption from over four million to tens of millions.
"The new OBIE Board remain committed to strengthening our governance and culture, a key focus as we move open banking to the next phase in its journey.”
Andrea Coscelli, CMA chief executive, added: “Four years ago, we ordered banks to give people control of their own data, helping transform the industry, drive innovation and stimulate competition. This has led to two million more people signing up for open banking in the last year. We are working closely with OBIE to strengthen governance, and to ensure that even more users make the most of the potential of open banking in 2022 and beyond.”