New figures published today show that customer use of Open Banking in the UK has surpassed the one million customer mark for the first time. Customer numbers have grown strongly, doubling in six months.
The legislation that underpins Open Banking, the second Payments Services Directive (PSD2), came into effect two years ago. Following a period of implementation Open Banking technology now allows consumers and small businesses to connect their bank accounts with authorised third parties in a safe and secure way.
Open Banking continues to grow rapidly and has surpassed one million customers who are already connecting their bank accounts with trusted third parties. Open Banking customers generate over 200M monthly calls, driven by over 200 active service providers. In addition to established ‘account aggregation’ players such as Yolt, services now cover personal finance advice, accountancy services, credit rating and charitable donations.
Innovation is further driven by The Open Up 2020 Challenge, run by Nesta Challenges in partnership with Open Banking Limited. The 15 finalists cover an exciting range of new services such as credit rating for renters (Canopy), financial vulnerability protection (Toucan, Kalgera), mortgages (Mojo), charitable donations (Sustainably) and artificial intelligence (Cleo, Plum). Open Banking is now also moving into the Payments realm, with over 50k payments made last month.
The Open Banking Implementation Entity (OBIE), the entity set up by the Competition and Markets Authority (CMA) to deliver Open Banking in the UK, shows the growth in customers has doubled in six months. These figures only represent customers of the CMA9, the nine biggest current account providers in Great Britain and Northern Ireland*.
Open Banking currently covers personal and business current accounts, credit cards and online e-money accounts. Currently there are 204 regulated providers, up from 100 at the end of 2018.
Imran Gulamhuseinwala OBE, Trustee of the Open Banking Implementation Entity (OBIE), commented:
“One million is a significant milestone, but by no means is it the end. Open Banking is about giving customers access to their data to rebalance the market in their favour. By creating greater competition, we are seeing innovation from new entrants and incumbents, which is leading to greater convenience and crucially greater engagement. We believe 2020 will be the year when adoption of Open Banking financial services really takes off.”
John Glen MP, Economic Secretary to the Treasury and City Minister:
“Open Banking has been a huge success in the UK and has made us a world leader in the technology. From better tracking of payments to stop customers getting overdrawn, to utilising data to improve access to finance, Open Banking has brought real improvements to the people and businesses using it. I’m now looking forward to seeing even more people benefit from this new technology in the year ahead.”
Christopher Woolard, Executive Director of Strategy and Competition, Financial Conduct Authority (FCA):
“The UK has led the way internationally in the development of open banking, which supports our objective of promoting effective competition in the interests of consumers. We welcome the growth in take up of Open Banking and support its continuing development.
“As we look forward, we also want to consider the potential benefits that could come from giving consumers and businesses control over a wider range of their financial data – so called Open Finance. We recently published a Call for Input on Open Finance and welcome views on what is needed to ensure it develops in the best interest of consumers and what role we should play.”
Dr Bill Roberts, Head of Open Banking at the CMA:
“It’s great to see that over a million customer are now using Open Banking technology to help them better manage their money. I look forward to many more benefitting from it when it is fully rolled out later this year. Open Banking will continue to transform banking for personal customers and small businesses by offering innovative services that provide people with a simpler and more secure way to gain control over their finances.”
Tahir Farooqui, Founder & CEO, Canopy:
“For our business and customers, Open Banking technology enables renters to track their rental payments and get credit for paying rent by adding rent to their credit score. Our aim is to help millions of renters improve their financial lives by first building a better understanding of rental expenses and corresponding impact on their credit score and savings aspirations. Open Banking has the potential to help millions of renters improve their rental and financial health.”
Loral Quinn, Co-founder & CEO, Sustainably:
“Open Banking has enabled Sustainably to automatically turn thousands of everyday cashless transactions into positive impact for a range of good causes. By simply connecting your card, Sustainably rounds up your spare change instantly, so wherever you shop you’re doing good. Now connected to 13 of the top UK banks, it provides people a simple, secure way to make micro-giving accessible to all.”
Notes to Editors:
*OBIE was set up by the CMA and funded by the UK’s nine largest banks and building societies: Allied Irish Bank, Bank of Ireland, Barclays, Danske, HSBC, Lloyds Banking Group, Nationwide, RBS Group and Santander.
Contact: OpenBankingMedia@cicero-group.com, 0207 297 5971
About Open Banking Implementation Entity:
The Open Banking Implementation Entity (OBIE) is the entity set up by the CMA in 2016 to deliver Open Banking. Our trading name is Open Banking Limited.
We are governed by the CMA and funded by the UK’s nine largest banks and building societies: Allied Irish Bank, Bank of Ireland, Barclays, Danske, HSBC, Lloyds Banking Group, Nationwide, RBS Group and Santander.
We work with the UK’s largest banks and building societies as well as challenger banks, financial technology companies, third party providers and consumer groups.
Our role is to:
- Design the specifications for the Application Programme Interfaces (APIs) that banks and building societies use to securely provide Open Banking
- Support regulated third party providers and banks and building societies to use the Open Banking standards
- Create security and messaging standards
- Manage the Open Banking Directory which allows regulated participants like banks, building societies and third-party providers to enrol in Open Banking
- Produce guidelines for participants in the Open Banking ecosystem
- Set out the process for managing disputes and complaints