Consumer insight specialist, Callcredit Information Group, is predicting the emergence of a dual speed data economy as the phased adoption of Open Banking starts on 13th January 2018.

Callcredit anticipates a gap will emerge between those businesses that are willing and able to harness the additional potential insights and enhanced consumer benefits Open Banking brings, and those that fail to recognise the consumer and associated business value it can provide.

David Ross, Chief Technology Officer, explains: “Open Banking has been designed to empower the consumer. If they choose, they will be able to consent to the sharing of their account information through application programming interfaces (APIs). Done properly, this will benefit both consumers and businesses alike. 

“Through the sharing of information, consumers will be given, and expect, a more tailored product and service offering and businesses will be able to develop more bespoke customer experiences, journeys and products. Those organisations that fail to adopt technology that enables them to access Open Banking information will be at a competitive disadvantage. The data and insights it brings will augment and enhance any existing data sources and those that fail to embrace it will be left behind.”

In 2017, Callcredit, in conjunction with specialist business consultancy, Ctrl-Shift, launched a report looking at Open Banking and the information economy. The research looked at how there would be a fundamental shift in operating models as Open Banking was adopted and how it would bring greater competition and new ideas to market.

Technology shouldn’t be a barrier, rather an enabler

David Ross continues: “We’ve been working with a number of clients against the backdrop of Open Banking and have gained some real insights from speaking to them and wider market participants. It’s clear some see the technology, data and analytics implications associated with Open Banking as a barrier.”

Phased adoption likely

Unlike other legislative changes, Open Banking will likely see a phased adoption by parties using the data. Banks will make APIs available but the number of businesses able to access and utilise these will grow slowly over time. Those businesses that have a heightened consumer focus and identify the opportunities earlier, will likely gain greater competitive advantage as others wrestle to implement the changes needed to utilise this new source of insight.

David Ross concludes: “As consumers, we all expect ever improving levels and speed of service. Open Banking will facilitate another step change in business’s ability to do this. Those that embrace these changes will be the ones with higher customer satisfaction and ultimately a stronger business model. The age of the empowered consumer has firmly arrived and businesses should adapt to this new environment or risk failure.”