What will open banking, open finance, and open data bring? 

With a load of developments happening around the corner, we often come across these terms- Open Banking, Open Finance, and Open Data. These newly developed words in finance have been described by regulations and practitioners alike as the next catalyst for reinvention in the banking sector and beyond. This process requires financial institutions to create interfaces (such as open Application Programming Interfaces (APIs)) through which trusted third parties (TTPs) can eventually automatically access customers’ bank accounts and access their transaction data as well as initiate payments upon customers’ consent.

The IMF Releases the 2023 Financial Access Survey finds that views on open finance, open banking, and open data are maturing with the proliferation of digital financial service access, as measured by the increase in the number and volume of digital financial transactions. Almost half of the respondents now consider digital financial services a ‘must have,’ a notable rise from the last years. The increase is significant across all territories but particularly pronounced in Africa (up to 50%), Asia and the Pacific up from (33% to 47%), and Europe (up from 45% to 56%). This precisely suggests that these sectors actively participate in newly launched products and services. Moreover, it has been witnessed that Colombia’s sector is growing up to 20% annually while adjusting 350+ entities in numerous businesses such as factoring, payments, insurance, digital credit, and financial services.

What is Open Banking?

Open Banking is a process wherein a user consents to share access to his banking data with a trusted third-party application via the implementation of APIs to experience a better banking experience. It’s becoming more popular because it allows faster and more secure transactions. Usually, this interaction occurs via secure application programming interfaces (APIs), with various instances such as:
  • Developing customer self-service portals.

  • Expanding the range of available payment options.

  • Speeding up the process of opening new accounts.

  • Consolidating all accounts for a unified view.

  • Facilitating immediate credit assessments.

  • Streamlining access to spending patterns and related data.

What is Open Banking?

What is Open Finance?

Open finance is the next step of open banking, where the user consents to share the data from any transactions involving the exchange of money, for instance- telecom providers, insurance bills, retail shopping, and utility bills. In this context, individuals consistently maintain ownership and full control of their data. It involves obtaining customer consent and ensuring the data is authenticated and verified.
Some instances of Open Finance encompass:
  • Customizing and individualizing value-added offerings for consumers.

  • Simplifying the retrieval of one’s historical transaction records.

  • Enhancing the accessibility and affordability of creditworthiness assessments.

What is Open Data?

Open data and data collaboration allow organizations to share and access many data types, not limited to any financial or transactional data. This process lets users enjoy personalized products and services.
Here are two instances demonstrating the practical application of this concept:

Streamlined Credit Evaluation:

Informed Car Purchase:

Meet growing appetite for experience open services with ECS Fin

Well, moving towards an open world presents opportunities, but challenges remain active. ECS Fin’s platform can be utilized to support open finance and open banking to unveil the potential of banking, businesses, and people across the globe with the right ingredients to move forward—swiftly. We commit our resources to promote a more competitive, innovative, intelligent, and dynamic supporting financial ecosystem. Expedite your open journey with ECS Fin’s robust solutions: 

  • Control and secure data

  • Comply with PSD2 using APIs

  • Deliver new innovative services to your customers

  • Monetize your business

  • Manage a digital ecosystem

Let’s make complex business processes simple innovative secure !