The consumer always decides: the potential of Open Banking will only be realized if it is understood and used by the consumer. But if the consumer doesn’t even know how they can benefit from recent changes in regulations, is Open Banking and the expansion of the banking ecosystem dead on arrival?
There is an urgent need for new services enabled by Open Banking to be communicated and explained to the public. To encourage and reassure, while always of course protecting the end consumer to ensure the safety of their data. Much of the initial mainstream media coverage in the UK during the PSD2 go-live was focused on potential scams and fraudulent activity. RBS even published a fraud report to coincide with the launch.
Security or scare-mongering?
It’s about security, various surveys say. In a post-Equifax data breech world, the thought of a third party accessing financial data simply won’t fly. Therefore, we need strong authentication to combat these concerns. All true – this will play valuable a role and help reassure the public that serious thought has gone into how new services will be delivered.
While scaremongering makes for great headlines, stringent measures exist to protect personal data, with every new and potential provider held to the same standards as the banks. Any third party wanting to deliver services via open banking will need to be authorized to do so by the Financial Conduct Authority (FCA).