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For me the big issue is the actual model used by Open Banking, PISPs and even the banks when it comes to our security and FinCrime related screening. I believe that wherever you are in the flow, the trust model right now is broken, so it is only right that you carry out the all FinCrime related screening and checking - no matter where you are in the flow of funds or even your role. Card processors should be seen no different here to clearing banks.

As I said however, the model is broken, thats why we have to do all these FinCrime related activities. Now, if we change the model away from "trust" to one of "knowing" then we start to see a different playment flow and FinCrime related service needs within in. This is where we need to see regulation changes, Open Banking model changes and a movement to a model of knowing....

Good to see this article, however, I feel it is quite dated in its approach. 5MLD is a challenge, but its also an opportunity to drive change within banks - primarily looking at two areas 1) customer onboarding and the experience that provides 2) onging monitoring of current customers.

Both approaches are dated, but i appreciate these are the best to go with right this second if you need to get compliant in a rush. However, the real answer is to invest in upgrading your systems to a true Digital Identity platform. 

This is a market that may appear to be rather complex, but the benefits of getting it right are massive for banks - ensuring 5MLD compliance but also improved security, reduced risk of GDPR issues being faced and drastically improved levels of customer experience (onboarding and simply in-general). SSI is gaining traction and there are small and large companies starting to really provide powerful solutions in this space, streetcred, evernymn  and idcrypt.global to name a few.

If you are looking at your compliance around this space, then its clear for the future that banks need to start investigating digital identity.  

in 2015 when we looked to re-imagine the UKs agency banking model and ultimately disrupt the status quo regarding access to underlying payment and banking systems, we decided to make ClearBank a true Banking-as-a-Service provider (I think probably the first back then).

BaaS provides so many benefits to institutions that leverage BaaS, be those FinTechs or incumbents. Benefits include improved service levels, everything becoming real-time, access to ever more powerful capabilities, the ability to design and build out new customer experiences at pace and a far cheaper and more efficient operating model.

BaaS is actually how end customers enjoy better customer outcomes - because it enables greater levels of competition and innovation. BaaS is in my mind, far more important than opening up access to key centralised infrastructure, such as payment systems like SEPA or the ECB directly. BaaS enables banking to be a "feature" and that drives far greater change and customer benefit than any other option.

A common message (well core of it) will help with the adoption of the standard amongst not just payment systems, but the banks that use the payment systems. This will help drive greater efficiencies in the payments ecosystem but also potentially interopability amongst providers and banks themselves....

These are some of the reasons why when designing what was to become ClearBank, we opted to ensure the entire cloud native core was built around the ISO20022 data dictionary, and that all messaging is always IS20022 compatible...

Great bit of innovative thinking and yet again, a service that solves a customer problem. Customer centric design in operation right here...

The issue with Open Banking type security models is the level of engineering required and the increase in friction for the customer. If Open Banking in any country is to really deliver on the promise, then we need to switch the model away from "banks" and back to the customer.

Us as customers need to be at the heart of the data, not the controllor simply of access to the data. If we switch that model, we can start to remove the complexities and friction associated with securing Open Banking.

This is great news. I have been saying for a while that new entrant banks will be more focussed on the needs of specific customer segments - Oxbury proves my point.

Well done to James, Nick and the team - looking forward to tracking your progress

This is something we did back in 2013 with a start-up called CloudZync and Tapsley. The PoC and initial live phasing was very encouraging. The issue back then was the payment rails and associated merchant acquiring cost - however, with PISP capabilities there are other types of models that could really bring these capabilities back to life....

After all, the end customer experience was exceptional

Someone looking to make a name for themselves....Show some "non banking" type thinking

The investment required to make this a reality is something that simply you couldnt get a return on.

The developer community expect certain tools and capabilities, and the specifics for financial institutions are pretty much all covered off now by the big two providers. The fact we have entire cloud native banks shows that there is nothing the "generic" cloud cannot do to cover off a specific cloud vertical for financial services.

In addition, the investment to get such a solution up and running just cannot be justified. Billions is spent per quarter on Cloud by Microsoft, which can only be justified by the number of use cases it caters for and the breadth of verticals it supplies. A single vertical simply doesnt make economic sense....

This feels to me like a technologist solving a problem that doesnt really exist and is care free to the economics behind the solution they are proposing.