The Emerging Payments Association (EPA), which celebrates collaboration and innovation between new and existing finance companies, has today (28 April 2020) published a report on open banking. Northey Point was pleased to be a contributor to this report.
The report provides an analysis of opportunities for payments in open banking and strategies for realising them.
With an overview of global initiatives and barriers to its adoption the report discusses the potential open banking has to change the entire payments industry.
The EPA state that, following the impact of the COVID-19 health crisis, there has never been a more important time for economies to have strong digital economies with data and payments available via secure application program interfaces (APIs).
The report suggests that “we just need to look at the impact that ‘opening up’ has had on other industries. In 2002 Jeff Bezos issued the famous API mandate e-mail, requiring every part of Amazon to build services and databases so that they could be externalised to the world. This triggered the development of Amazon as we know it today. It enabled huge amounts of innovation, creativity and value creation to be built, internally and by others, on top of Amazon’s platform.”
The detailed assessment, Unleashing the Potential of Open Banking, aims to be a ‘rallying cry’ to the payments industry, from issuers and regulators, retailers and acquirers, regulators and third-party providers to help unlock the significant opportunity that open banking offers.
“This report is a case study showing collaboration in action. And that’s at the heart of open banking. Readers across the world can use it as a guide, as a series of checklists, drawing on what works – and what can go wrong. It will help accelerate the adoption of a common approach and common standards, and as a result, help make payments work for all.”Tony Craddock, Director General of the Emerging Payments Association
The report is informed by a series of discussions and interviews with leading payments executives from the United Kingdom and beyond. These industry experts explained how their organisations are preparing for a large-scale adoption of open banking. Northey Point was pleased to be a contributor to this report.
The report also covers the several potential barriers to the adoption of open banking, from protection and user trust, to API performance and availability, and a lack of market incentives.
These barriers, whilst problematic, are weighed up against the positive potential impact on payments including the emergence of a new value chain in the payments ecosystem and wins for the big technology companies.
The analysis allowed the EPA to identify actions and recommendations for itself, its members and the wider payments industry. These include crucial themes such as ‘how to help create the market conditions for success’, and the ‘need to champion standards and the user experience’.
The EPA’s new working stream ‘Project Open Banking’, will aim to implement these recommendations and help pave the way for payments to play a central role in enabling a transformative change in financial services.
Download the EPA’s report on unleashing the potential of open banking by visiting: https://www.emergingpayments.org/article/unleashing-the-potential-of-open-banking/
For more information about the new report, the EPA will be holding an ‘Open Banking’ webinar to discuss the report on the 4th of June.
More information can be found at: www.emergingpayments.org
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