IT 
ES 
Since the start of 2018 we’ve seen a string of articles discussing open banking, explaining the impact of PSD2 on the industry and consumers. Examining these articles has been insightful – and in many cases it reveals a lot about the current mood towards the banking sector. So, what can we learn from this recent media attention?
Convenience is key
Many publications, including the FT and The Guardian, have highlighted one of the main advantages of open banking – account aggregation. The idea of being able to manage all bank accounts from one app or website is enticing. Indeed, back in 2015 it was reported that 1 in 5 UK consumers had multiple bank providers, and with the rise of challenger banks such as Monzo, it seems inevitable that this has increased since.
With this added complexity, plus the fact that “saving worries” were found to hold significant mindshare for 2018, many consumers would prefer to have one destination where they can deal with all their finances.
This applies not only to apps and websites, but to bank branches as well. One of our predictions for 2018 was the concept of white-labelled financial hubs. Rather than ATMs and services only being accessible in exclusive branded locations, banks could instead work together to provide one destination for consumers. A physical/digital hybrid of account aggregation.
The growing remit of ATMs and bank branches also comes into play, to ensure that all financial services are accessible from one high street location.
A challenge for the white-label bank branch is consistency. Users expect a consistent experience – whether online or in-store. It’s imperative that banks use the technology available to offer the range of services that customers expect – and are smart with how they approach this. A truly omnichannel approach is necessary for this, providing a personalised experience to the customer, as well as ensuring a competitive advantage, even in a collective environment.
Data concerns are front of mind
But these articles on open banking aren’t wholly positive. In most cases, the largest concern has been data. Is your data safe and secure? How can consumers ensure it is used responsibly? This represents a much more guarded attitude to data, that is impacting all industries in the UK. What’s more, this trend is only set to grow – with the arrival of the digital native into the market [link to digital native blog post].
In fact, 49% of consumers don’t believe that businesses care about their data privacy. This becomes even worse when examining financial institutions, trusted by only 32%.
Banks, therefore, have a mountain to climb in 2018. They need to work hard to earn the trust of their customers, and be careful in how they are using data. Consumers want to see clear benefits, so banks should focus on using data to improve customer services and add personalisation. There must be respect for data, otherwise banks risk being victim to a backlash.
Open banking – a double edged sword?
For consumers and banks alike, open banking will bring a wealth of opportunities. PSD2 will deliver new opportunities and convenience. However, for banks to take full advantage of this they need to be aware that they will be under intense scrutiny – and that there are fears that need to be recognised and respected.
