Open Banking – Empower Consumers Through Innovation
The Open Banking Revolution
Open banking, the ability of third-party applications to access consumer banking and financial accounts using Application Programming Interfaces (API), is becoming a major source of innovation and is poised to reshape the competitive landscape of the banking industry.
By networking accounts and data across institutions for use by consumers, financial institutions, and third-party service providers, the consumer benefits from a seamless and transparent banking experience.
Competition Creates Opportunity
Financial institutions have long held a monopoly over their consumer data. This data control, once a competitive advantage, is a hinderance in the era of Open Banking.
It’s critical that we view Open Banking as an opportunity, not a threat. It invites openness and innovation among financial institutions which will benefit the consumer. And Open Banking is not just a benefit to consumers. It will cause large, established institutions to compete with smaller, more nimble banks and FinTechs, resulting in lower costs, better technology, and a more seamless and integrated customer experience. Financial institutions can take advantage of this new technology to strengthen customer relationships and customer retention by becoming an active partner in managing consumer’s finances rather than acting simply as a transaction processor.
Legacy Systems and Incremental Innovation
Legacy financial systems may present a barrier to innovation since these systems may not be well-positioned to address Open Banking strategies. Financial institutions will need to address limitations within their current systems and invest to adopt new technologies which allow them to compete.
Incremental Innovation allows financial institutions to deploy next generation solutions which are better suited to address speed-to-market needs of an effective Open Banking model. These API Gateway solutions integrate with legacy financial systems to allow improved speed-to-market while reducing risk to legacy systems and traditional financial services.
Pick A Strategy
Financial institutions should define incremental innovation strategies with the goal of deploying future-proof API Gateway solutions which allow them to expand technical capabilities to meet the ever-growing demand for consumer-centric solutions. Euronet’s REN Innovation Ecosystem is designed to meet these ever-changing needs.