6 months in the life of Open Banking
We’re 6 months into the biggest financial services shake-up for the past 20 years, but what’s actually happened since the launch of the revolutionary Open Banking?
Let’s be honest, the launch had less of a firework bang but more of a party popper fizzle. Though this was for good reason.
To outsiders looking in, it may seem like there’s been little or no movement since launch. But behind the scenes leaps and bounds have been made to ensure that the technology that enables Open Banking is up to the highest standard to power the products that add value to people’s everyday lives.
Rolling on out
Managed roll out. Some may be aware of it. A minority may have taken part in it. But the majority are in the dark about what really happened during the managed roll out or what it meant for the Open Banking timeline and ecosystem.
Between January 13th and April 16th participating banks (CMA9) and regulated third-party providers (TPPs) worked together to extensively test and prove that the Open Banking API endpoints were robust enough to support large volumes of traffic whilst protecting consumers.
The managed roll out limited the number of call-backs any one third-party could make which allowed banks to:
- Test the TPP on-boarding process
- Fix any unforeseen issues before the APIs were released into the wider market
- Work with TPPs to understand how to better their user experience
With the aim to solidify the capability of the participating banks and TPP processes before releasing the APIs into the wider market, the managed roll out successfully set a strong basis for Open Banking to go live with consumers on April 17th.
16 banks and sub-brands live with more coming soon
On April 17th, 8 of the CMA9 endpoints launched. This covered the following banks and sub-brands; Allied Irish Bank (AIB), Bank of Scotland (BOS), Barclays, Danske Bank, First Direct, Halifax, HSBC, Lloyds Bank, M&S, Nationwide, NatWest, Royal Bank of Scotland (RBS), Santander and Ulster Bank.
Since go live, OpenWrks, the first TPP connected to all available participating banks, has been analysing and monitoring the performance of each banks endpoint. Providing a free and exclusive insight into the speed at which each bank can retrieve tokens, account-requests, accounts, transactions and balances.
Take a look at the current state of the Open Banking API performance.
Greater than 90% market coverage
Challenger banks are living up to their reputation, they aren’t waiting for the dust to settle, they’re jumping in alongside the big name banks to create their own Open Banking endpoints.
With the likes of Monzo and Starling Bank releasing their APIs and Clydesdale Bank soon to be following suit, the scope of Open Banking now covers greater than 90% of all UK current account holders.
Real people are using real Open Banking connections today
Open Banking launched with a sprinkling of scepticism.
It was common to see articles on the lack of consumer knowledge or hesitation at the thought of Open Banking. With lasting effects of recent blunders from TSB online banking and the memory of Cambridge Analytica and Equifax data breaches who could blame them.
But consumer reluctance hasn’t reared its unforgiving head. In fact quite the opposite.
Real people are already trusting the process, consenting to Open Banking connections and getting valuable results in real time. OpenWrks clients are already seeing positive results with improved conversion rates and happy customers.
A collaborative ecosystem will make Open Banking great
The future of Open Banking is in the hands of the big name banks and TPPs alike. They need to join forces and collaborate to ensure that the Open Banking ecosystem is the best it can be. Here’s the OpenWrks rally cry to Account Servicing Payment Service Providers (ASPSP) and TPPs to make the ecosystem great.
1. If you’re not already involved don’t wait for the PSD2 deadline
Now’s the time to give your customers access to better tools, services and products.
2. Progress response time performance
For the full value of Open Banking to be realised we need millisecond response times to deliver realtime, in app insights to consumers.
3. Improved release management
Ensure fixes or updates from the banks do not disrupt live services that people are using everyday.
4. Design your authentication journey for the customer
The biggest concern with wide scale adoption from consumers is the customer journey. Many banks have designed for compliance and as a result created unnecessary friction and complexity. TPPs including OpenWrks are feeding back to the banks to help improve these journeys for customers.
5. Keep up the pace
There are still teething issues, which isn’t surprising due to the complexity of the implementations. The pace needs to accelerate bringing additional features to the APIs that will deliver even more value to consumers e.g. decoupled authentication or Personal Identifying Information (PII) data.
1. Get involved
Test the APIs and feedback to ASPSPs and the OBIE on what works and what doesn’t for your customers and businessmodel.
2. Share your experiences with other TPPs
Demonstrate what needs improving to make Open Banking work for all consumers.
3. Don’t wait around
If you don’t have the capacity to develop against the APIs you can be up and running in the OpenWrks lab within a week.
As of the 22nd of June, 33 third-parties are authorised and registered as Account Information or Payment Initiation Service Providers (AISP, PISP). As this number grows, more and more people will be able to get access to better products and services that are personalised to them.
Let’s hope another 6 months down the line more people will be reaping the benefit of Open Banking in everyday life with faster applications, streamlined processes and access to better financial management tools.