Most large banks in Asia Pacific think providing Open Banking services for their commercial clients is a key strategic initiative in their digital transformation programmes, and many expect it to help them achieve double-digit revenue growth, according to research from Accenture.
According to the study, 90% of large banks in Asia Pacific plan to provide Open Banking services for their commercial clients, with half expecting Open Banking to help them grow their revenues up to 10% and another one-third expecting it to help them move their revenues up to 20%.
The research also shows that commercial bank customers in the region want the same things that retail bank customers want — more-innovative processes and a better customer experience. When asked to identify the most significant benefit of using an Open Banking ecosystem platform, respondents in AsiaPac most often say gaining access to convenient and innovative banking services, cited by 30% and 20% of executives at large corporations and SMEs, respectively.
Commercial bank customers also expect Open Banking to help them reduce complexity and implementation costs for bank connectivity (cited by 24% of large corporations and 23% of SMEs) and enable them to reach more clients and partners (cited by 19% of large corporations and 21% of SMEs).
When asked to identify the business areas that could be most improved in partnership with their bank through Open Banking, respondents at SMEs in AsiaPac cited payments, finance and cash management, while large corporations cited finance, treasury management and payments.
More than one-third of commercial bank customers in the region already participate in Open Banking platforms and another 37% plan to do so in 2019. When asked who they would prefer to partner with on Open Banking initiatives, three-quarters of large corporate clients and nearly two-thirds of SMEs cite their bank. Only 12% of large commercial clients and 16% of SMEs would prefer a non-bank technology provider.
“Much of the focus so far when discussing Open banking has been on the retail market, but value-creation can be just as big, if not bigger, in the commercial banking side,” says Fergus Gordon, banking practice lead, Asia Pacific, Accenture. “Demand from businesses is clearly there for innovative services and banks have a lot to gain by tapping into those opportunities.”