Open banking is a simple idea: individuals can share their financial data with whichever authorised third party provider they choose. This seemingly straightforward change in banking regulations paved the way for a host of revolutionary innovations which aims to redefine the way we do finance.
Yet, despite its place at the leading edge of financial technology, open banking has never been the coolest kid in town. In fact, it has yet to be fully embraced within its own field, let alone muscle out some of the tech world’s more high-profile trailblazers for column inches and public attention. But with the pandemic posing a unique threat to both our physical and financial well-being, people’s priorities - and the focus of their conversations - are quickly shifting.
Talk of the Town
Finance is a topic which is currently at the forefront of many people’s minds. This is borne out by the Google stats: searches for credit products such as “loan” and “mortgage”, along with phrases such as “financial help” and “help with money” all spiked as the pandemic hit.
With bank branches closed and phone lines jammed, people have increasingly turned to digital resources for financial information, advice and help. This may come in a number of forms: internet searches for relevant articles or websites; sharing tips and links via popular messenger apps; or chatting with family, friends or colleagues via video conferencing.
For financial service providers to find their way into the conversation, they need to provide customers with the types of innovation needed to meet the unique set of financial challenges they are now facing.
The Time For Open Banking Is Now
In recent months, the financial services industry has seen an increase in demand for:
- Digital services to avoid the need for in-person interactions
- Easy access to financial products and services
- Greater personalisation of products and services
- Help in safeguarding personal financial health
Each of these presents its own unique set of challenges, and although many banks and lenders have focused on expanding their digital capabilities in recent years, the sheer pace and scale of change caused by the pandemic has left shortcomings exposed and many playing catch up.
However the technology which will allow financial service providers to close the gap to customer expectations already exists in open banking. Whether it be automated credit applications which speed up the delivery of loans, personal finance management tools which enable customers to better handle their finances, or analysis of transaction data which provides a more personalised insight into a customer’s financial situation, open banking can provide the seamless, real-time and personalised banking experience customers need to meet the challenges of a post-COVID world.
FriendlyScore is an open banking technology provider working with financial service providers during COVID-19 to streamline processes, boost analytics and deliver digital solutions into the hands of their customers. To find out more, visit www.friendlyscore.com today.