by Paul Rohan
Open Banking is an emerging and high-profile area in financial services. There is a ‘market forces’ definition of Open Banking. It refers to the use of Open APIs that enable third-party Developers to build applications and services around banks. There is also a ‘regulatory’ definition of Open Banking, focused on greater transparency and choices for bank account holders which is being enforced by regulators. Some commentators suggest that Open Banking could cure many ills in modern banking.
The emerging Open Banking environment is often described as an Ecosystem. Healthy ecosystems have viable populations of various interacting species, ecosystem diversity, a constant evolutionary process and sufficient evolutionary potential. The potential interactions in an Open Banking Ecosystem interests many investors and entrepreneurs. Within existing banks, corporate strategists, technology specialists, business unit leaders and risk managers are also examining its impact on the landscape of financial services. As an Open Banking Ecosystem emerges, a central question must be the capability of existing banks to adapt and evolve into this new environment.
Open Banking Strategy Formation examines the forces that are likely to influence the evolution of Open Banking at an industry level. The transition of the industry to Open Banking will come from a patchwork of deliberate and reactive changes by existing and emerging market participants. Open Banking Strategy Formation will help existing and new market participants to judge how and when their businesses can become part of the Open Banking Ecosystem.