Open Banking Technology: the Consumer’s Digital Piggy Bank

 -Open banking technology

What is Open Banking Technology?

“Open banking is the concept that allows banks to share customer data with third-party companies or apps securely and in real time, through the use of open application interface platforms. Making that data accessible to other parties allows them to build a better customer experience; by having different records of the same data updated at the same time, customers’ view of their finances is more accurate and they can compare, analyze and manage accounts more effectively or make more sound financial decisions.” Digiday

How does this differ from Online Banking?

Online banking before open banking technology was a risky venture. Thanks to this new technology, your data is now more secure. Now, a third-party provider like those who run your bank’s app, access your user information through a token which can be tracked by the bank. This means the app doesn’t need to store any of the information, making your data less vulnerable to hacks.

Open banking is, of course, dependent on banks sharing their APIs with third parties.

Open Banking in The U.S.

In the United States, Citibank and Wells Fargo were amongst the first to adopt open banking technology. Pioneered by fintech companies like Mint, the concept permits consumers to gain a 360-degree view of their finances.

Consumers are looking for systems that allow them to better understand their finances. 18 months after Mint’s launch, they reported 4,000 to 7,000 new users every day.

The Open Banking Standard

Many banks have been hesitant to share data with third-party providers. This is where the Open Banking Standard comes in, to provide structure and security.

“…the Open Banking Standard is a more comprehensive plan that gives customers even greater control and insight into their financials. Under the Open Banking Standard, banking data will be shared through secure open APIs so that customers, be it individuals or businesses, can more effectively manage their wealth. Open APIs would allow third party developers to create helpful services and tools that customers can utilize.”The Financial Brand

Is Open Banking Technology the Fuel to Digital Banking Transformation?

Open banking technology is changing the industry, by leveraging digital technology to provide a more secure service, that puts the consumer need for increased visibility into their finances at the center.

It’s Customer-Centric

Open banking technology is firmly putting the customer first, something that the banking industry has been slow to do. The world of finances has never been more complicated. Consumers are sick of jargon, of complicated processes and are seeking simpler ways to manage and understand their finances. Millennials, in particular, are keen to manage their finances in a smart way. The average Class of 2016 graduate has $37,172 in student loan debt and this weighs heavily on graduates entering the working world. Open banking technology is helping to provide clarity.

It’s Secure

A major challenge hindering digital transformation across the Financial Services is security. CISOs and CSOs are fighting the increasing threat of hacks and are investing heavily in the cyber security. By using API technology, open banking is eliminating the threat of hacking apps for private information.

It’s Digital

Open banking technology leverages the latest in digital technology. By essence, it’s fueling digital transformation.

It’s Adaptable

This technology can adapt to changing customer needs or new innovations, offering banks a long-term option to answer the call for digital transformation.

Open banking technology presents a significant opportunity for banks looking to digitally transformation as a strategic move.

Most notably, this new technology offers significant high levels of security. Cyber security is a huge challenge for digital transformers. Protecting consumer data, as well business assets is a vital step in the road to implementing digital technology in your business.

The transparency of open banking also adds to this technology’s potential impact on digital transformation. A key driver is the desire to improve the consumer experience. As consumer’s look to have more control over their finances, open banking offers a unique opportunity to provide information and also store data securely.


FSI Transformation AssemblyThe Millennium Alliance is pleased to announce that application for their biannual FSI Transformation Assembly taking place September 14-15, 2017 at Four Seasons Resort in Palm Beach, FL is now open.

Following on from the success of our February edition with Keynote speaker – Lisa Shalett, Retired Partner and COO of Global Compliance, Legal & Internal Audit, Goldman Sachs, the FSI Transformation Assembly will bring together North America’s major financial services and insurance organizations.

While financial services and insurance CIOs will have to deal with many challenges in the coming year as the industry makes the final leap into digital transformation. C-level IT leaders need to understand the convergence of mobile, social, and cloud to stay ahead of the competition. One technological challenge remains prominent in the mind of CIOs everywhere – dealing with the complexity of data. This is something challenging all digital transformative industries.

With digital enhancement comes a massive explosion in data, which is creating unprecedented manageability issues for firms around the world that can be linked to the following factors: expanding customer touch points, emerging types of structured and unstructured data, new customer engagement and social media platforms, rising data security, and controlling the overall data volume.

This is not just another “Financial Services” event. Spaces are reserved for the best in the business. Enquire about attendance here!

Ally Financial CIO
Credit Suisse Managing Director and Technology Controller
Fannie Mae SVP & CIO
MasterCard President, Global Technology & Operations
Morgan Stanley MD & CIO
PwC Vice Chair, Global Chief Information Officer

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