Industry Analysis
Although institutions may prefer to receive their technology from a single provider, bankers’ responses prove that this is not always the prevailing practice. In the past, many third-party technologies were disconnected from the core system. However, APIs allow seamless connections, enabling real-time data movement and reducing the need for extensive staff and operational data transfers.
The above also illustrates that institutions are trying to do more with less, creating new workflows for efficiencies or working with fintechs to help access previously inaccessible markets. An embrace of open banking is often related to operational efficiency, as well as better serving customers and minimizing attrition to digital banks or standalone fintechs.
The case for open banking lies in the potential for adaptability and choice. Though there remains concern around vendor management, data security and other factors, many see this area as an opportunity to turn a competitive environment into a collaborative one and offer the same or better functionality than any competing institution in their market. Only a negligible 1% didn’t see a relevant goal for their institution and open banking.