Member Article

The Payments Association tips open banking as its next big bet, driving industry competition and innovation

A report released today by The Payments Association (formerly The Emerging Payments Association (EPA)), confidently predicts that open banking is going to transform the payments industry in the coming years. Largely this is because new entrants are bringing solutions to market that are making accessing financial services more convenient, while creating new customer experiences or enhancing existing ones.

Open banking means giving customers more control of their financial data, more control of how they use their online bank account and more control over which channels they use to manage their accounts. Open Banking is starting to deliver in the UK; with over three million users of open banking services in 2021, it is spreading to more markets around the world each day, driven by new regulation and increasing consumer demand.

The newly released ‘Power to the People: How open banking is transforming how we access and manage our money’ insight paper provides an overview of open banking developments globally, the impact for end users, and a wealth of use cases across different industry verticals. These include use cases that directly serve consumers better like subscription payments management or personal debt management, as well as use cases that serve businesses like small business financial management and credit scoring. The report includes key findings from interviews with innovative players in this space: AccountScore, Ecospend, Minna Technologies, Snoop and Ordo.

It also explores the impact that it open banking is having in different markets around the world, outlining the position that North America, Latin America, Australia and New Zealand and Asia are taking, as well as those of other markets.

The Payment Association’s insight paper reports that together with ever-more sophisticated machine learning/artificial intelligence solutions, open finance will create a world where consumers are empowered with real insight into their financial positions and are supported by ‘self-driving’ solutions to achieve better financial wellbeing .

Tony Craddock, Director General at The Payments Association, commented: “Innovation has been driving the payments industry in recent years at a rate never seen before, but open banking is set to up the game once again. Its introduction hasn’t been a smooth road, but now that it is overcoming some of these early hurdles, it will be a force for good, driving industry competition and providing customers with greater transparency and better product choices.

He added: “The impact that open banking can have cannot be understated, from personal finance management, loyalty and rewards, and credit scoring to ethical and sustainable living.”

This was posted in Bdaily's Members' News section by Lilidh .