Open banking is transforming global finances, driving innovation and competition

From Yahoo Finance: 2025-04-23 12:52:00

Open banking is transforming how people interact with finances globally. By 2029, it’s estimated to reach $94.14bn. The UK leads with 12.09m active users in 2024. The FCA and PSR are expanding open banking in the UK, focusing on recurring payments and e-commerce. The EU and Australia are also pushing open banking forward, but the US lags behind due to security concerns and regulatory challenges.

Financial services must use APIs to power open banking, ensuring data security and compliance with regulations. With APIs, third-party apps can access customer financial data with consent. However, there is a risk of increased cyber threats, emphasizing the need for encryption and confidentiality. Countries must learn from each other to perfect their frameworks and ensure customer benefits from open banking.

Overall, open banking fosters competition and drives innovation in financial services. It’s crucial for customers to understand its benefits to embrace and support its growth. Steve Morgan, Global Banking Principal at Pegasystems, highlights the importance of open banking’s development globally. The future of open banking relies on collaboration, innovation, and customer understanding.



Read more at Yahoo Finance: What is in store for open banking globally?