Open Banking technology enables organisations to easily compare Personal Current Account, Business Current Account, Business Loan and Commercial Credit Card products from banks operating in the UK. It also makes it simple for organisations to access detailed information – such as locations and opening times – on bank branches and ATMs.

It does this by maintaining Application Programming Interfaces (APIs) and standardised data structures that govern how banks make information about their products, services, branches and ATMs available.

From January 2018, Open Banking, working with UK banks and regulators, will release APIs and standards that enable organisations – with the customer’s permission – to read the transaction history of Personal and Business Current Accounts and initiate payments from those accounts.

The sort of services delivered through Open Banking to personal customers could include:

  • A current account comparison site that looks at the way you use your current account to recommend the best account for you;
  • A money management app that gives you tips and advice based on your current account usage;
  • An app that monitors your balance and warns you if you are going overdrawn;
  • A secure website where you can see all your financial information in one place to give you a clear picture of your financial position, even if you hold products with different providers. You could make transfers between them and make payments all from this one site;
  • Speeding up a loan or a mortgage application because you give the lender permission to see your banking information directly;
  • Making it quicker and easier to setup and make payments to retailers, directly from your bank account (instead of having to use a credit card / debit card);
  • A global view of your financial situation – information will be pulled from your different bank accounts and presented in one place;
  • Finding the right financial products for you – it will allow third parties (e.g. a price comparison website) to pull your spending patterns / habits from your bank, analyse them, and recommend products based on this i.e. a cheaper overdraft, a better credit card;

Here are some commonly asked questions:

How do I control who has access to my data?

Third parties will only be able to access your data or initiate payments from your account if they have your explicit consent to do so.

How do I control the type of data I share with a third party provider?

A third party will only request the data it needs to provide their service and they will describe exactly what that data is, how long they need it for and what they will do with it. The customer can make an informed decision on whether they want to share their data or not.

How do I know I can trust a third party provider?

Third parties will have to be registered with, and regulated by, the FCA or competent authorities of other EU countries before they can offer any service through Open Banking. Details of registered parties will be available on the FCA website.

How can I be sure that a third party is secure?

Each third party will have to meet certain criteria to become registered with the FCA. They will also have to comply with the security standards that underpin Open Banking.

How will my bank/building society know that I have given consent to a third party?

When you give consent to a third party you will go through a step where your bank/building society verifies your identity. This is likely to be similar to how you access your internet or mobile banking services at the moment.

How can I opt-out of Open Banking services that I previously signed-up for?

You can opt-out of Open Banking services through the website or mobile app of either the third party or your bank/building society. Either way will mean that the third party will no longer be able to access your data or initiate payments.

Will I be charged to use Open Banking services?

Any charges related to Open Banking services will be driven by market competition and the commercial models of the third parties you agree to act for you.

Is Open Banking safe?

We have all been taught to never share our account details. That’s still good advice in many ways, but the difference with Open Banking is that we are creating software and security systems that let you share access securely.

What sort of services will be available through Open Banking from January 2018?

From January 2018 through Open Banking you will be able to securely share data from your current accounts with third parties. Also at this time you will be able to make single “one-off” payments from your current accounts. This could be a payment to another of your accounts at a different bank/building society, a payment to friends or family or a payment to an online merchant.

How can I find out more?

You can find out more about Open Banking from the regulator and Which? using the links below.    

Financial Conduct Authority (FCA)