Open Banking Insights: Customer conversion – why it matters and how it’s measured

Open Banking Insights: Customer conversion – why it matters and how it’s measured

By Alex Whiteley, Head of Customer Success, Basiq

Australia’s answer to “open banking” – the Consumer Data Right, or CDR – is picking up steam.  We’ve reached a tipping point where more consumers are sharing data from more banks with more financial services across more use cases, and with those growing numbers we can now reliably measure and contrast performance from bank to bank.

Typically, performance based metrics are challenging to determine because the information needed is just not available. The limited performance measure that is public is the number of banks sharing data via Open Banking and their ‘uptime’, which as of January 2023 sat at over 99%, and only refers to the connection success rate.

Additionally, there is no way to easily compare how financial institutions (the data holders) are stacking up; who is leading the way and who is underperforming?

And let’s not forget the heart of the CDR – the consumer. As a business, I know you want to know how many consumers are using CDR and, most importantly, the conversion rate.

The good news is:

  • Firstly, Basiq is in a unique position to generate these insights into Open Banking. Our depth of knowledge and experience using web connectors (also known as ‘screen scraping’) means we are able to directly compare the performance of both data access methods. Via Basiq’s platform, we also have the highest number of business customers accessing Open Banking, across the widest range of active use cases in market, which enables us to measure and monitor these performance metrics that matter.
  • Secondly, you have me, a customer advocate and certifiable data nerd at Australia’s leading open banking platform, to crunch the numbers, tell the stories and push for more accountability.

Today I’m going to look at consumer experience (CX) and conversion: why it matters, how we measure it, and how the data holders stack up.  In future posts I’ll pick out other stories but I’ll track and update the CX leaderboard each month.

But first, we need to talk about …

“The state of Open Banking”

I’ve got that in quotes because I’ve seen the phrase so often the words have lost all meaning!  It’s a hot topic though, with some voices in the media saying that CDR is not ready to support all use cases (actually I agree – but this argument misses the point.  Did Google support search, maps, email, docs, translate, meetings and forms all on day one?)

CDR is young and there are gaps but it is already delivering value for our partners in investing, lending, payments, early wage access, the green economy and personal finance management to name a few.

Screen scraping (“scraping”) is the precursor to Open Banking. It’s also the data access method Basiq was founded on in 2017 and has used extensively since. For our customers who have transitioned to open banking (with the same use case, requesting access to the same banks and using the same user experience) we are seeing a 10% increase in the number of customers converting and sharing their data through CDR compared to scraping.

Use cases which got value from scraping are getting value from CDR today.

The quality of data from CDR is on a par with that from scraping: in some cases it’s great and in others it’s not what you would hope.  Under scraping we developed a resilience to gaps in banking data quality, and we’re using those same smarts to help our customers under CDR.

To get the most from CDR you’ll need to make some tweaks to your UX, we can help you with that; there are a few banks who are more stable with scraping than CDR, we can guide you on that too.  But this blanket argument that CDR is not ready does not jibe with what we’re seeing.

To read more, please click on the link below…
Source: Open Banking Insights: Customer conversion – why it matters and how it’s measured