Open banking – What does the future hold?

24th January 2023 | Blogs, News

Industry predictions for 2023

In December 2022, the OBIE saw the completion of the managed rollout of variable recurring payments (VRPs) for sweeping, marking the final milestone in the Competition and Markets Authority (CMA) Roadmap which brought open banking to life five years ago.

As adoption continues to grow – more than six million consumers and small to medium-sized enterprises (SMEs) in the UK now benefit from open banking-powered apps, products and services – we ask experts from the industry, regulators, and trade associations to count open banking’s successes so far and, as it moves to open finance, to explore the opportunities ahead.

Innovate Finance CEO, Janine Hirt shares her thoughts:

“The UK has a great story to tell on open banking. With more than six million active users, open banking has unlocked new business models and services, and improved financial outcomes for individuals and businesses.

In the current cost of living crisis, open banking has an important role to play in helping consumers effectively and intelligently manage their money. There is an opportunity for open banking to drive an even greater reduction in costs for businesses and households. To achieve this, government and regulatory action would be welcomed around areas such as extending the scope of VRPs or 'sweeping', which will, for example, help reduce transaction costs and enable additional budgeting tools.

A mix of both collaboration and competition in 2023 between fintechs and the heritage financial institutions will be necessary to drive the best outcomes for consumers.

We also predict even more digital financial services companies will use open banking, as people continue to demand the speed, efficiency, and ease that it provides. Open banking will continue to transform the payments and lending landscapes and will also have a key role to play in reducing fraud in financial services.

To achieve its full potential in 2023 and beyond, it is imperative that we all – government, regulators, and industry – work together to keep up the positive momentum and move forward with the development and acceleration of open banking in the UK, for the benefit of the consumer.”

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