Confidence in Service Providers Critical to Open Banking Adoption Says European Consumer Study from Mobey Forum & Aite Group

Confidence in Service Providers Critical to Open Banking Adoption Says European Consumer Study from Mobey Forum & Aite Group
08.11.2019 06:58 am

Confidence in Service Providers Critical to Open Banking Adoption Says European Consumer Study from Mobey Forum & Aite Group

Open Banking

The overwhelming majority of consumers would prefer their main bank, as opposed to other banks or third-party providers (TPPs), to be their primary source of open banking services, a new pan-European study from Mobey Forum and Aite Group has revealed.

The report, entitled Open Banking: Open Minds? Consumer appetites for open banking services’, draws on a survey of over 1000 consumers in Finland, France, Germany, Spain, and the United Kingdom. It highlights the opportunity for banks to create new open banking services and emphasises that the window during which consumers are hesitant to share account data with other banks and TPPs will close as the category quickly evolves.

“It’s crucial that banks act on their short-term advantage quickly to avoid disintermediation by TPPs as the open banking market evolves,” comments Elina Mattila, Executive Director, Mobey Forum. “Consumers trust their banks because no-one else does data security and privacy like they do - it’s a cornerstone of their success. Consumer confidence in third party banking services, however, continues to grow. Open banking is the next chapter in the digitalisation story and a new generation of agile, specialist TPPs is forming to capitalise on API-based payment and data services. If banks want to protect their place at the forefront of the industry they need to act now, either to offer TPP services under their own brands, or to create their own. Either way, they need to move before the TPPs can establish an independent base.”

Despite open banking’s infancy, the study reveals that already approximately one third of consumers are either ‘very interested’ or ‘extremely interested’ in five open banking enabled use-cases: account information services (32%), pay by bank (33%), purchase financing (25%), product comparison (35%), and identity check (35%).

Security and privacy, however, are cited as the main factors inhibiting adoption among those consumers expressing concerns. The report contends that banks should pay strong attention to these differentiating factors when launching open banking services, as competition for consumer trust increases.

The report also explores under which circumstances consumers might be willing to deprioritise trust and, instead, favour convenience and usability. When questioned over their willingness to adopt a new payment method, for example, 91% respondents indicated that they could be tempted to switch either by financial incentives or the promise of greater convenience. 

“Trust alone is not enough,” adds Mario Brkic, co-chair of Mobey Forum’s Open Banking Expert Group, George Labs. “Banks must also focus on developing services with convenience and usability in mind. People are already willing to give huge amounts of their personal and financial information to brands like Google, Amazon, Facebook and Apple. When the services deliver real value, they are ready to share data. Many open banking TPPs can respond to consumer demand faster than traditional banks can, so the race is on. The real winners in open banking will be those that can provide superior customer experiences under a trusted brand.”

Related News

TIBCO Partners with Microsoft for Missing Maps Initiative

TIBCO Software Inc., a global leader in integration, API management, and analytics, today announced its work with Microsoft... Read more »

Open Banking Expo reveals future for Open Banking

Speakers at this year’s Open Banking Expo have revealed their predictions for the future of Open Banking at the sold-out event in London yesterday.

 

In his... Read more »

Nuapay and Thyngs partner to combat cashless charity challenge

Nuapay, a pioneer of open banking, announces its partnership with mobile technology platform, Thyngs, to help charities tackle the decline in donations due to reductions in... Read more »

Tink Solidifies its Commitment to UK & Ireland with Appointment of Stripe’s Former Head of EMEA Banking as New Market Lead

Open banking platform Tink has strengthened its commitment to the UK and Irish markets by appointing Stripe’s former head of EMEA banking, Rafael Plantier, as its new Country... Read more »

World Retail Banking Report 2019: Inventive Banking is key to maximizing banks’ strongholds and delivering exceptional last-mile customer experiences

Banks must collaborate with start-ups to remain relevant as the financial ecosystem evolves from Open Banking1 ... Read more »

Trustly opens two new tech hubs in Vitória, Brazil and Lisbon, Portugal

To further refine its online banking payment solutions and accelerate the build-out of global coverage, Trustly is pleased to announce the opening of two new tech hubs in... Read more »

Magazine
ALL
Free Newsletter Sign-up
+44 (0) 208 819 32 53 +44 (0) 173 261 71 47
Download Our Mobile App
Financial It Youtube channel