Inside open banking

Stay informed as we uncover the technical rollout of open banking, starting with the UK and Europe.

Hey Readers,

The success of open banking is not guaranteed.

Welcome to Connecting to financial data. If you're developing or considering whether to create a product that uses open banking, this newsletter is for you.

You may have heard claims like 'open banking will be the end of traditional banks' or 'open banking has failed'. Let's start by dispelling these myths: nothing is guaranteed about the success of open banking, but it has not failed. Open banking is already in use and is being further built with every new connection.

In this newsletter, we'll focus on what can be done with open banking now and in the near future. We'll discuss the security aspects, data governance, currently supported use cases and how to prepare for upcoming changes affecting open banking integrations, such as eIDAS certificates. Most of the details are technically complex, but I will do my best to explain as we proceed.

The technical complexity of open banking, including the Financial-grade API (FAPI) specification and eIDAS certificates, makes it difficult for developers to build their APIs integrations. To make things worse, you may discover that the features you planned for your product won't work as expected after a significant amount of development work.

If we implement open banking correctly, it could change the way we relate to our finances in a move that empowers customers along with financial service providers. On the flip side, poor implementations will erode customer trust in open banking as a whole, which is a real possibility that could negatively impact the fintech ecosystem.

According to the Open Banking Implementation Entity (OBIE), open banking has seen increased usage during the COVID-19 pandemic. If you want to learn more about it, now is better than ever.

Thanks and all the best,

Dexter

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In the meantime, tell your colleagues/partners/friends!

P.S. Feel free to send a message to dexter@patn.consulting if you'd like to discuss a consultation for your open banking project.