Banking, as a domain, has always been a competitive one. To keep up with the pace of the dynamic nature of this sector, banks & financial institutions are gradually making the shift to experiment with newer technologies, like Open Banking and innovative concepts like FinTech, designed specifically for the banking sector.
The basic idea behind all these innovations remain to offer a better experience to consumers and leverage the choice of integrated systems that are widely available today.
Are you OPEN to Open Banking?
The impact of technology in making our lives better and smoother can’t be overemphasized enough. FinTech (an excellent combination of finance and technology!) is one such area making the traditional banking system seem redundant with each passing day.
The rise of Fintech sector has been exponential in the last few years with Fintech adoption seeing a sharp rise globally from 16% in 2015 to 33% in 2017 on an average.
Open Banking API (Exclusively covered as Open Banking API: A Journey, 1st part of this series of 3) is the newest offering of FinTech that holds immense potential to bring about a transformational banking experience to its end users.
However, before making the switch to Open Banking, it is essential to understand what the concept is trying to achieve and who will it really benefit?
So What’s the Buzz called ‘Open Banking’ All About?
With Open Banking, banks are moving to Agile technologies, building strong partner networks, and creating robust mobile platforms which cater to consumer’s needs, thus enabling direct financial transactions between customers and businesses and making cross-platform payments a reality.
It works as a systematically designed collaborative model. Here the customer’s banking and other financial information/data is shared to trusted third parties (with the customers’ consent, of course!) through APIs with the aim of offering enhanced capabilities to the users.
Thus, Open Banking is a financial services term as part of the financial technology that refers to:
- The use of Open APIs that enable third-party developers to build applications and services around the financial institution.
- Greater financial transparency options for account holders ranging from Open Data to private data.
- The use of Open Source technology to achieve the above.
In short, “Open Banking is the possibility of creating new digital business and ecosystems through APIs provided by the banks.
This allows customers:
Who will ‘Open Banking’ Really Benefit?
The benefits of an Open Banking model aren’t just limited to consumers but extend to service providers as well. It benefits, one and all, associated with it.
Among the many benefits of Open Banking to consumers, the most important include:Giving the Benefit of Choice to Customers
As a service provider, banks generally offer limited options and the same services to all their customers.
Open banking, on the other hand, gives the benefit of choice to customers as they now have the freedom to select from multiple service providers available. It also empowers customers to take charge of their finances and make informed decisions to manage their accounts.
Benefitting Banks and Financial Institutions
Being ‘Customer Centric’ is the key. With Banks and Fintech merger, by using Open Source technology, together they can offer customers a holistic service or product, which will increase the customer satisfaction, loyalty, and certainly, revenue.
Among the ways Open Banking can specifically benefit fintech sector include:
Open Banking offers them the opportunity to extend their services offering for better customer engagement as well as retention.
The Changing Face of Banking
There is no denying the fact that FinTech usage has risen significantly in the last few years with an increasing number of players adopting this robust technology to offer better services.
However, there is still plenty of room left to grow and prosper. With Open Banking carrying the potential to change the way we bank, the need of the hour is to use technology mindfully. Also to keep the consumer’s trust intact by taking necessary measures before authorizing third parties to access customer data.
We are TEKNOSPIRE
Teknospire is a FinTech company where we have built and deployed solutions, helping the service aggregation companies, mobile financial services, banks, micro-finance, and insurance companies.
Their collaboration with Teknospire has given them the leverage to extend their reach out to the rural areas with the ‘customized solutions’ that are ‘just right’ for them by extending their technology and current solutions.
Take a look at Teknospire’s approach in building Financial Inclusion @Last Mile and how through lean technology we can help consumers and financial institutions to achieve it.
Our API for YOU
Listed with Oracle marketplace, Teknospire’s API can be used for creating, authorizing, capturing, voiding, refunding a payment as well as getting information on previous payments.
With Teknospire’s mission to enable banking for every individual, you can also reach to us in Mozambique, Zambia, Nepal, U.K., Bangladesh, and Zimbabwe.
Following ‘downloadable links’ to our ‘just right for you’ products – as we famously call it “Digital Banking Platform” in a box – “FinX”, can help you to know more about what’s on the platter:
Changes of convenience become normalized very quickly. Physical Payment Cards might share their storage box with audio cassettes and LPs. Well, you ‘Never Know’. The concluding part, coming soon, in this series of three, ‘Open Banking: End of Card Payments?‘ will give more insights.
Few links may provide a better understanding of Open Banking, API and Open Banking Myths:-
Keep looking for this space and subscribe to our blogs to stay abreast. Happy Exploring!
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