- How far along is the financial services industry on the journey from open banking to open finance?
- As the drive to digital increases, the barriers to entry lower. What are the modern data architecture changes needed to not just keep up with open, embedded ecosystems, but also increased competition?
- What do companies operating under open finance rules need to consider when sharing financial data with third-party providers?
- And what are the technical challenges financial institutions are facing in the open era? How can they overcome legacy systems to embrace the open finance revolution?
- Regulations like FiDA are adding another layer of complexity. How can institutions unlock the potential of open data while adhering to the highest regulatory standards?
The financial industry has made significant progress in financial data access through open banking and progress will expand beyond payments with regulations like Payment Services Directive 2 (PSD2) to what is explored in the PSR and PSD3. Open banking has marked the beginning of this new era, and now the shift toward open finance is the essential next phase in this transition, with incoming regulations like Financial Data Access (FiDA) covering new areas including mortgages, pensions, investments, and savings.
While these initiatives hold promise, a successful open finance framework will require many financial institutions – who still rely on outdated systems and processes that may not natively support the flexible data access requirements of FiDA – to review their data architectures. If institutions can’t adhere to strict geographic data regulations (with certain jurisdictions enforcing that data remains within specific regions), guarantee real-time data availability, or scale in real-time to handle increased API traffic, further data modernisation efforts will be required.
How can financial institutions navigate this complex web of open architecture, flexible infrastructure, data requirements and regulation? Modern ecosystems require modern solutions, so organisations need to re-think their approach to data, not just to be able to facilitate open finance, but also to stay relevant in an increasingly competitive landscape.
Sign up for this Finextra webinar, hosted in association with MongoDB, to join our panel of industry experts who will discuss how the move to open finance can be managed effectively with the right data architecture in place.