Intelligent Issue 07 | Page 69

CHEQUING OUT providers securely access customers ’ financial data from banks and regulated institutions . The key principle that should govern Open Banking is that consumers are able to secure permission for their data with transparent consent for the different services they want .

To drive Open Banking in South Africa , the impetus needs to be tri-directional – competition , regulator and consumers . The change needs to happen on all three fronts . The countries where Open Banking is driven just top-down by regulators , the conversation is usually around APIs and its technical standards – not how much of the consumer ’ s data can be gained via these APIs .
To truly harness the power of technology and create a systemic shift , all the players need to come together and ensure that the needs of the consumer are not neglected when balancing the priorities of the regulator and the banks . The regulator should ensure this initiative promotes competition rather than creating another conduit for monopoly . They should also make sure that the end consumer is safeguarded . The third-party players should act as consumer ’ s data fiduciaries and empower the consumer instead of using this as an opportunity to penetrate in the market and increase their revenue share . The emphasis for
all players should move away from the bottom line to the triple bottom line ( profit , people and planet ).
Open Banking allows for the development of new and more personalised financial products and services and improves the overall customer experience . It also drives down costs for customers and helps to increase financial inclusion by providing access to financial services for those who may have been previously excluded from the traditional banking system . And most importantly , it enhances competition by opening the ecosystem to non-banking players .
It has the potential to transform South Africa ’ s financial services sector . It can enable banks to access new revenue streams by partnering with FinTech firms and reduce their cost of customer acquisition . It can enhance a FinTech ’ s value proposition by giving it the power to build innovative business models , new experiences , products and services . In addition , it can help to improve the security and reliability of financial transactions by providing a secure and standardised way for customers to share and access their financial data . Overall , Open Banking has the potential to benefit all the players in the ecosystem if adopted correctly and at scale . � www . intelligentfin . tech