Arthur Ribakovs, director of financial partnerships at Ecommpay, identifies regulation, consumer protection and partnerships as areas where pace has been slower.
1. What development in the Open Banking space, in your opinion, should people be paying attention to?
We need to pay attention to global adoption and regulation. It’s exciting to keep an eye on how Open Banking is being adopted and regulated in different countries around the world. Regulations can significantly impact the pace and scope of Open Banking implementation.
Also, I believe we’ve reached the moment where we need to pay attention to collaborations between traditional financial institutions and fintech companies. These partnerships will drive innovation, create new financial services and enhance customer experience.
What impresses me the most is the fact that we can already experience the creation of innovative financial products and services. We should keep attention on developments that offers users better insights into their finances, personalised recommendations and improved financial management tools, and not be scared of them.
The final one would be to keep an eye on consumer adoption and awareness. The success of Open Banking purely relies on consumer adoption. And we have the evidence that more and more consumers are getting familiar with the flow of Pay by Bank, and it becomes their first choice of payment after the first try.
2. Are there any areas where pace has been slower than expected?
There are a few:
1) Regulation: We know that PSD2 has had a massive impact on Open Banking, but there are still some aspects that are not covered. We have observed that in rare cases, users can still recall payments even after the initiation. Although these instances are uncommon, they can occur.
2) Consumer protection: In the card acquiring world, users can claim a chargeback if they are dissatisfied with a good/service or do not receive it at all. This assurance of funds being returned is not available in the Open Banking world, which may deter users from choosing Open Banking payments due to security concerns. This is particularly noticeable in the travel sector. Addressing this issue could be related to PSD3, where there is a clear explanation of how users can claim their funds back in cases of goods/services not being provided and transparent procedures. Implementing such measures could boost Open Banking payments in the travel sector.
3) Partnerships: There have been too few announcements about partnerships that could encourage the industry to pay more attention to Open Banking. It’s crucial to understand that Open Banking has the potential to increase user spending in the long run. However, we need to consistently communicate to users how Open Banking can enhance their financial understanding and improve their quality of life.
Arthur Ribakovs is speaking on the Retail Stage at Open Banking Expo UK and Europe on 18-19 October in London. Check out the agenda and get your tickets here.