How can you leverage Open Banking in your Business?

Open Banking is starting to hit the mainstream consciousness. Many are still unaware of the concept. Simply put, it is a regulatory change across Europe that requires banks to enable access to customer accounts by trusted third parties.

Data: The great deliverer - An exciting time for digital finance

Having reported in March that they ‘hoped to launch an open banking app in months’, a few weeks ago HSBC launched Connected Money. The app offers customers the ability to view banking details across up to 21 banks, including current, savings and mortgage accounts.

There was no hullabaloo around the release. No publicity song and dance. Clearly, whilst they’ve apparently been in beta testing for a number of months HSBC are keen to test the public waters, relatively incognito (as incognito as one of the largest global financial institutions can be…), to ensure they’re delivering updates quickly. They’re the first of the major banks to publicly offer open banking capability. They want to get it right. It’s testament to how big the potential in open banking really is. Gaining, listening to and reacting upon early customer feedback is critical. The reviews are starting to come in, and they’re good; 4.3 out of 5 on Apple’s App Store at the time of writing...

It’s important to highlight that whilst this initiative delivers the principles of Open Banking, industry commentary alludes to it not actually utilising Open Banking APIs… Yet. However they’re not far away. In February HSBC owned bank, First Direct, revealed they are actively trialling ‘artha’ app, which does utilise Open Banking API technology.

This initiative reflects HSBC’s early adopter strategy in delivering an Open Banking proposition to market. The transition to utilising available APIs can be implemented whilst HSBC are garnering customer engagement and feedback. Risky? Possibly. Valuable? Absolutely.

In taking the proposition to market HSBC has joined the likes of of Yolt and Cleo in offering customers the cross banking provider capability. So why is this different? Because of how they access the data.

Open Banking Interfaces & APIs

As a trusted third party company, HSBC will directly access customer banking data via FCA regulated Open Banking interfaces. Customers will be able to grant consent to third parties and their banks to share data. Without proactive consent, no data will be shared.

Recent scandals regarding the illicit collection, use and sale of personal data highlight the public demand for governance and control in how data is shared. And this is exactly the premise of Open Banking.

What does this mean for retailers? The focus so far has been on how it will shake the banks up. But, in reality, the bigger shake up will be in the Retail sector. At the end of 2017, as Open Banking prepared to launch, Answer’s Payments expert and Lead on Open Banking, Imran Ali, offered an insightful ‘Guide to Open Banking for retailers’. It highlights two key areas of opportunity; payments and data.

Open Banking enables retailers and banks to work together

Open Banking enables retailers and banks to work together directly, without the need for intermediaries or merchants. The potential commercial benefits through payment service provider costs reduction is profound.

As Imran Ali previously wrote, “Open Banking is not about the technology, it’s about the customer”. The real potential is in future customers experiences. Open Banking leads a new path towards frictionless checkout experiences in eCommerce, and the ability through insight and analysis of customer transactions, to create personalised offers to customers. Customer loyalty is transient. Open Banking could be a vehicle by which retailers are able to further engender loyalty and retention.

The challenge for retailers is to assess how and when they start to consider Open Banking strategies. Open Banking is starting to hit mainstream consciousness, and yet many are still unaware of the concept. The challenge for retailers is to assess how and when they start to consider Open Banking strategies. Keen eyes will be cast over early adopter solutions. Evolution will occur quickly, and the floodgates will release the next wave of digital retail disruption.

Want to hear more?

To find out how you can leverage Open Banking in your business, or if you’d just like to find out more about Answer and the work we do, contact me on This email address is being protected from spambots. You need JavaScript enabled to view it..

About the Author...

Rich heads Answer Digital Retail, delivering world class solutions to clients including Costcutter Supermarkets Group, FCUK, Arcadia and Ramsden International. Richard has a passion for retail and the transformational impact technology is having on customer experiences.