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That’s a good point, Ketharaman, if we compare the US regulation with the UK/EU regulation. In the USA Open Banking is more industry-based, whereas in the UK/EU it’s regulatory-based. When an industry in the US sees that there is a demand for opening data, it focuses on developing that product. Whereas in the UK/EU the regulator decides first that they open data and then the industry should adjust to these regulations. 

Definitely agree with you, James. As an industry, we have to focus on the value that Open Banking can bring to both businesses and end-users. For businesses, the advantages are more or less straightforward (lower costs, SCA, no chargebacks, data about the users), whereas users need an explanation on why they are better off using their bank instead of a card.  Consumers are creatures of habit and are used to paying with their cards, or other traditional methods and would naturally assume that it is a more secure way to pay. We are not claiming that Open Banking will replace payment cards, but it will be interesting to see how the industry adopts Open Banking and its inherent advantages.  The industry is moving fast, creativity is key, so coming up with innovative products that consumers can use without being afraid, in this case, to use their bank, either for payment or for information. There is still room for innovation with Open Data.

Thanks for your comment, Melvin. In terms of public information, there are many articles and white papers from various sources on how Open Banking can change the industry and benefit consumers. The UK is counted as one of the strongest and most advanced regions in terms of Open Banking adoption, so naturally, there is a lot of focus but I do agree that there is more education needed at the consumer level. Security is absolutely key and of paramount importance to end-users, this is where OB can reduce fraud; a user always confirms their payment via Strong Customer Authentication using Face ID, Touch ID, or unique passwords. When confirming the payment, the user is redirected to their own online banking app within a secure environment, it is important to note that only regulated providers are allowed to initiate OB payment.

For merchants who are considering Open Banking, there are 2 major factors that make it an attractive proposition – Costs & no risk of chargebacks. During the height of Covid, we saw an increased risk of chargebacks as well as fraud. Online shopping fraud statistics show that global losses from payment fraud reached $32.39 in 2020 – three times more than in 2011.