What the fintechs think about open banking’s progress? Part 2 Fluidly

Chief reporter and senior editor EMEA

After Open Banking celebrated its first birthday this month I though it apt to get some views from different parts of the industry about what has been its impact so far and what they expect this year.

The Industry analysts I spoke to were united in the view that Open Banking will bring huge changes to the finance sector but this will not happen overnight, in fact it didn’t happen in the whole of last year and won’t happen this year. It will be gradual.

I am now getting the views of fintechs about what they expect. This might shed more light on why it will be an evolution rather than a revolution in the banking industry.

Here it the latest comment, courtesy of industry membership group Innovate Finance, which had asked some of its members for their views.

It comes from the CEO of Fluidly. The fintech provides cashflow management software which utilises artificial intelligence.

Caroline Plumb, CEO of Fluidly.

How would you measure the initial uptake of open banking and was it as big as you hoped for?

“Banking data is shared via APIs, which allows two pieces of software to talk to each other and share information. Whilst these APIs already exist, there is technically a long way to go before they can be used widely. This is the limiting factor on the uptake of open banking currently, and as the technology improves, more services and products will spring up. The initial uptake of open banking has been more of a trickle than a flood.

That said – there is lots of support and encouragement in existence to help providers and users start to explore the possibilities of Open Banking. Fluidly has recently been the winner of a £200,000 prize fund organised by Nesta. The fund is specifically aimed at companies who are transforming small business banking via Open Banking. Funds like this will accelerate the uptake of Open Banking as it helps to get new products built more quickly and raises the profile of what’s now available for consumers and businesses.”

How can we reassure the public about the safety of open banking and its benefits?

“Security and data privacy has to be taken extremely seriously and a great responsibility lies with any company who holds or uses sensitive digital data. Users can be reassured by the fact that these companies are FCA regulated and the Open Banking initiative covers users for fraud in many circumstances if they have shared their data with authorised third parties. Companies can also take measures to show users that they are taking the regulations seriously. Fluidly is fully GDPR compliant, and the data we hold is encrypted at all points. “

What does the year ahead hold for open banking and what new innovations are on the horizon?

“The winners of the Nesta Open Up Challenge have just been announced, 6 companies who will share a £2.5m prize pot to develop their Open Banking proposition. I’m thrilled that Fluidly was one of the winners and I know that the money will speed us towards achieving our goal of helping small businesses to sleep better at night. Initiatives like Nesta also help companies technically; we’ll get early access to an anonymised test data set that will allow us to build more quickly and get a great product to businesses. Funds like this will have a game changing effect on the next year of Open Banking. We’ll be excited to see future additional functionality live in the Open Banking APIs as the roadmap progresses – perhaps improved payments, multi-user authentication and more data sets like credit cards.”

What the fintechs think about open banking’s progress? Part 1 TrueLayer