Open Banking: Redefining the Financial Services Sector

Banking CIO Outlook | Tuesday, February 26, 2019

Fintechs have been taking the banking industry to the next level through the latest innovations like open banking. Due to these innovations, customers can monitor their financial wealth remotely. People living in countries like Hong Kong have been accustomed to the open banking scenario today.

According to a survey by Accenture, people living in territories of Hong Kong are far more interested in open banking compared to the people living in the other parts of the globe. The survey reports that half of the people expect that the bank revenue will increase by ten percent due to open banking. Whereas, some surveys also anticipate that there will be a 20 percent increase in revenue.

A similar survey by Accenture states that most of the consumers in countries like the UK are not willing to share their financial information with third parties. On the other hand, the citizens in China have been enjoying open banking apps on their mobile phones.

Recently, Canada has also started an open banking consultation in order to show a positive sign toward the open banking scenario. The main aim of the consultation program is to broaden the Canadian mindset and enable them to experience the broader advantages of the financial system. The  Client Consultation Committee has taken into consideration both the pros and cons of open banking and has invited the public to submit their comments. If the majority goes on to support open banking, then the committee will move forward in providing the consumers with the implementation of the same.

In the consultation paper, the department highlights the benefits of open banking. It adds the point that it allows the users to review their financial transaction data every month. By the representation of spending patterns, an individual can indulge in saving goals. Open banking creates new insights to the Canadians helping them to get enhanced financial services.

YouGov research shows that around 72 percent of UK adults are unaware of open banking. In countries like the UK and Australia, open banking has still been a roadblock for rapid adoption.

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