Steve Andrews, Head of Managed Services at Focus Solutions, predicts that higher demand for open banking will drive up the number of providers in 2020.
Open banking: only scratched the surface
In the last year we’ve seen the number of UK open banking providers rise from 8 to 19 as they bring new functionality to market and consumers start to access and benefit from these services, but we have just scratched the surface.
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Next year, I expect this trend to pick up pace as retail banking technology is increasingly influenced by the demands of open banking, providing a great opportunity to service clients smartly and more efficiently.
Customers are free to share their financial information with whichever company they choose, regardless of with whom they bank, which gives financial institutions a golden opportunity to access a wealth of data and get a better picture of their customers’ entire financial situation.
If you look at the lending space the ability to access customer financial data, transaction history and spending habits in real time allows for very efficient and precise processes to be adopted, as well as other on boarding activities such as KYC and AML with significant cost savings for lenders and a greater customer experience delivered.
Helping less profitable customers get better advice
While face-to-face advice remains an important part of a retail bank offering, increasingly sophisticated financial software allows elements of self-service, giving traditionally less profitable customers greater access to advice.
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By GlobalDataTake Skipton Financial Advisers for example. It launched its new systems in September. Skipton followed this approach by including new adviser tools that allow services like triage, which enables the filtering of clients to the most appropriate advice model and investment proposition at an early stage.
There is an increasing amount of use cases where open banking data can be fed directly into client facing advice tools, like savings and investment calculators, pension and cash flow modellers, to create a far more personalised approach across every financial service a retail bank offers.
This type of smart automation creates slicker, faster and more personalised services that help people better manage their finances, while helping banks increase their customer base and maximise customer satisfaction. I expect to see more banks utilising technology to gain an early mover advantage in 2020.
