As open banking continues its path toward offering consumers greater financial products and services, it is interesting to consider what things are necessary for open banking to become the new normal. Perhaps there is no other single thing more important for the long-term success and uptake of open banking than consumer confidence and trust. Overall, consumers appear to be ready for the promise of open banking, although there are still some consumers who are cautious about it. This especially holds true regarding concerns over data privacy and security.
For open banking to really take off, banks, regulators, FinTechs and others need to ensure that three key areas are improved going forward:
- Cyber protection – using more sophisticated digital tools and techniques to keep consumer data safe
- Regulatory protection – embedding a regulatory framework with sufficient consumer safeguards, including rights to recourse and penalties for any providers that contribute to causing damage against consumers
- Value added – providing open banking services that support consumers in achieving their goals