This year we spoke at the PayThink conference, a bank focused payments forum. The themes of the conference were consistent with those in the wider market, the main focus being on moving towards ecosystem banking:
What this signifies is a shift from “product to sell” to “customer to serve”.
At the conference, we spoke about how in the UK that shift is starting to be driven by regulatory forces, like Open Banking.
Historically, in the UK, customer-focused regulation has acted to reactively manage a breakdown in trust. Open Banking is a proactive mandate to accept and organize financial data in a way that recognizes:
However, not all FI’s can access this financial data, and not every market is under the same regulatory pressures, so how is this relevant to all players, internationally? Focusing on interoperability and open APIs is a clear demonstration that data will be at the core of better service delivery and retaining valuable, sustainable customer relationships.
What this means for FIs is, there is a new way of understanding, interacting and designing for the end customer. The availability of customer level data, not just product interaction and transactional data, creates a much richer, clearer and more accurate picture of the customer to be served.
There is definitely an excitement about open APIs and data-led product development and delivery. It is raising the profile of data in financial institutions but there is not a lot of conversation about how to access and maximise the use of this data. There are three key opportunities for any financial service to utilize this data and stay relevant in an ecosystem environment:
For most organizations, some elements of this data already exists within their organizations, even if it’s not being pieced together today. Open banking wasn’t about creating new information; it was about bringing together the data and customer understanding that already exists within the market. It’s about unlocking data to drive growth.
Whether it’s regulatory driven or not, the data revolution is upon Financial Services. The question isn’t about whether you will keep up, it’s about whether you will be clear on the value you will add in this data-led new ecosystem, to partners and end users alike.