Insight: Consumer trust and bringing Open Banking to life for the consumer

30 Mar 2020

Rishi Chauhun, formerly of the Open Banking Implementation Entity, offers some industry insight into enhancing consumer trust and how the Fintech market needs to continue firing on all regulatory cylinders to gain their trust.


Open Banking presents consumers with an immense opportunity to move, manage, and make more of their money. It represents convenience, time and cost savings. For most consumers, it is an opportunity to get tailored financial products and services that better meet their needs. For others that are currently underserved, Open Banking represents better access to financial services.

However, consumers are concerned about giving lesser known fintech brands access to their bank or building society accounts. Concerns revolve around the unintended consequences of sharing data:

  • What could be inferred from their data (e.g. net worth, credit history or sensitive information)?
  • Will their data and identity be protected in the same way as their bank or building society does?
  • Which other parties may be able access their data and could that lead to a detriment (e.g. unsolicited marketing spam or being charged higher prices)?

In the payments context, this translates into concerns around potential payment fraud and having the same level of protection through open banking as they would using cards. Overall, consumers are concerned about the level of accountability amongst fintechs and how they would get redress when something goes wrong. The bank or building society is still seen as having primary responsibility for addressing fraud and security issues. These concerns may present barriers to significant consumer adoption beyond the early adopters, so what can fintechs do to gain consumer trust?

In addition to directly addressing the above concerns as they may apply to a fintech’s consumer audience, fintechs have the following two powerful anchors of trust at their disposal:

Clarity on the value exchange

Utility and needs always trump concerns and reduce the perceptions of risks. Consumers are willing to share their data as long as they are clear on the benefits to them:

  • How will the fintech’s product or service meet their needs?
  • What will they be exactly getting in return for sharing their data?

The fintech will have an even stronger benefits messaging if answers to the above questions are coupled with trust messaging that reassures on data security and the regulated status of the fintech.

Fintechs should clearly communicate their benefits and trust messaging to consumers at the following two levels:

  • Communicate the overall benefits of the fintech’s value proposition through their market messaging and through their customer experience as early as possible in the customer journey
  • Communicate the specific value or the benefit consumers will get in return for sharing their account information, just before the account information sharing request is made within the customer journey. This may be a reminder of the overall benefits or may be a specific benefit they may get just for sharing their data

An example to bring this to life – A credit card provider that may provide tailored interest rates (overall benefits) to consumers based on assessing their account information. They may also provide the consumers a snapshot of how high their current credit costs are and the costs savings to them, if they were to switch, as a specific benefit for sharing their data.

In a payment’s context, the specific value exchange for making a payment using open banking could be loyalty points or discounts or buyer protection programmes.

Consumers in control

Consumer choice and control are seen as the key benefits of Open Banking. Historically, consumers have felt a lack of control in dealing with their bank or building society, consumers felt that their bank or building society has much more information and market power. With open banking, consumers now have a greater choice in terms of who they get their financial products and services from. Consumers can now also decide who they share their data with amongst the alternative providers, bringing greater balance to market power. Fintechs should make the most of this need for control and build trust by emphasis consumer choice and control through their market messaging and customer experience.

An example to bring this to life – As part of the Open Banking customer experience, fintechs have to request consumer consent before requesting their data from their bank or building society or making a payment on the consumer’s behalf. Fintechs can build trust, by making this step in the customer journey as engaging as possible:

  • Such that it does not remind consumers of terms and conditions e.g. by using icons and images to enhance scanning and comprehension
  • By using a tone that emphasises consumer control and choice
  • By maximising comprehension of exactly which data will be requested, for what purpose and for how long
  • By showing how easily the consent can be revoked