Open banking - Australia, behind the eight ball, report says

A report by Capgemini and Efma, entitled World Retail Banking Report 2017 (WRBR 2017), states that as the Open Banking revolution continues to unfold, banks risk disintermediation.

The report offers two suggestions for how banks can avoid disintermediation: Firstly, banks must carefully choose their customer interaction business model, and secondly, they must use application programming interfaces (APIs).

The report also states that banks, in collaboration with FinTechs, can lead the Open Banking movement by offering their customer bases innovative and personalised services that create new revenue streams and provide more value to customers.

“FinTechs are now earning higher positive customer experience scores than traditional banks, and banks are openly seeking to collaborate with FinTechs,” says Anirban Bose, global head of Banking and Capital Markets, Capgemini.

“Open Banking offers banks an opportunity to retain and grow their customer base as they add the varied services of third parties to personalise and customise products and services. For banks that don’t think strategically and establish a role in Open Banking, there is a chance they will be disintermediated from their customers.”

“It is imperative that banks consider business transformation approaches now, to establish and solidify their long-term base in Open Banking,” continues Bose.

The power of APIs

According to the report, APIs can offer a pathway toward Open Banking, if FinTechs and financial institutions collaborate rather than compete to create customer-centric solutions.

“The most successful banks will use open APIs to generate new customer insights and revenue streams, while also improving customer experience,” comments Vincent Bastid, Secretary General, Efma.

To read more, please click on the link below…

Source: IT Brief Australia – Open banking – Australia, behind the eight ball, report says