Will the Future of Banking Depend on Open Banking?

Banking CIO Outlook | Wednesday, August 12, 2020

Through APIs, open banking is offering external-party financial service providers open access to financial data from banks and non-bank financial institutions.

FREMONT, CA: The banking industry is one of the significant beneficiaries of the latest advances in software technology. Today, accounts, payments, and other finances could be managed easily through mobile banking applications, banking software, among other banking solutions. An article published in openPR talks about the digital transformations in open banking. The role of open banking will increase further when more players in the financial business recognize the advantages of fintech collaboration through APIs, and consequently, the value of an API strategy in their digitization efforts. 

Open banking is an evolving banking trend that harnesses APIs to help customers use banking services via various online platforms. An improved customer experience, new service models, more reliable revenue streams for businesses, are all some of the benefits given to consumers and companies via open banking, making it a win-win-game. Customer demand is now reaching heights like never before. The modernization that the banking industry witnesses today is indeed a result of the ever-evolving and heightened customer demand. Connecting all the dots, tech critics say that open banking is here to stay for long.  

The possible benefits of open banking comprise new revenue streams, enhanced customer experience, and a sustainable service model for underserved markets. By adding more consumers to the formal financial system, open banking boosts the market opportunity and the power to deliver valuable assistance in the future. While it seems inevitable that open banking will result in the loss of some degree of control by compelling banks, other banks will gain the offsetting advantage and privilege of participating in larger profit pools.      

See Also: Top Banking Technology Companies

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