Global digitalisation made open banking developers and financial institutions transfer their focus to consumer necessities. Nowadays, a consumer requires fast and easy access to their finances, without ever needing to consider going to a physical bank and talking to a person. Smartphones are there for a reason and they should be able to assist with finances. Therefore, the banking industry must take advanced steps to retain consumer loyalty. Discovering innovative ways to conduct services and implementing new technologies is a key solution.
Open banking presents an unprecedented possibility to transform financial transactions and the way consumers and businesses manage their finances. It is a system facilitated by innovative technologies, various regulations and its core purpose is to transform the financial industries landscape. To bring the changes to reality open banking developers implement novel banking services and generate new ways for the involved parties to interact with them. They also create advanced banking models and improve e-commerce capabilities.
Application Programming Interfaces (APIs) are the key participants in the development process. Third-Party Providers (TPPs) can access banks' stored data through APIs and developers can design anything from new microloan services to payment gateways or even e-wallets.
There are plenty of benefits that open banking brought to the financial industry and improved banking. However, here are five key most prominent:
Every financial institution in compliance with open banking regulations has secure access to their data for TPPs. The open banking developer portal is where the access occurs and developers can create apps and services to adhere to customer needs. TPP like Nordigen has built an open banking developer portal where it aggregates European banks APIs and therefore saves valuable developer time.
When using TPPs like Nordigen developers can gain access to account history for as long as 24 months, encounter limitless User Interface (UI) building experience without added widgets and get all of that without any fees.
However, legacy banks still have to adapt to the new market situation and comprehend that banks are not the only financial services providers. The change might not come fast, but it is vital if banks want to stay afloat and succeed in the long run. Open banking will turn around the payment market and the services become fully digital. This new financial model requires banks to reestablish their position and change their tactic according to the new situation.
Legacy banks had a position where consumers were not in charge and had to adapt to the bank's offerings, however, when fintech came to play they shifted the focus to consumer needs by implementing a series of digital tools. Therefore, a bank's choice to cooperate with third parties and incorporate open banking developers portals will help to digitise processes and bring benefits to both involved parties - consumers and businesses.
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