What does open banking mean for a customer?
Open banking brings about a much more convenient way for customers to access their financial information.
Open banking is a groundbreaking technology that shapes and improves the accessibility and usage of many financial services – from day-to-day money management to life-changing financial decisions.
Centralized financial accounts overview
Open banking technology allows banks and other financial institutions to share their customers’ financial data through application programming interfaces (API). It enables users to see conveniently the information of all of their different accounts in one app. Open banking allows combining various credit cards’ balances and history into one and includes investment, loan, retirement, business and consumer accounts into a single unified interface.
This innovative technology helps people navigate and analyze their finances in a simplified, hassle-free environment without going through different banks and other institutions to access and collect relevant financial data.
Easier and broader personal finance management
Customers can set up and limit money boundaries according to their monthly needs. It is even possible to assign spending to different categories of products, services and subscriptions in a centralized manner. Clients can share their data with accountants or analyze their finances and investments much more conveniently and efficiently.
Open banking paves a path for AI-powered services, acting as a financial advisor and helping people understand how their money and investments perform in the market and banks. Implementation of AI systems for reducing cost, improving customer experience and ensuring security is especially promising.
Additionally, it could help people find better products and investments. Centralized data from different users’ spending could enhance competition between some businesses by finding and offering alternatives for the customer to get services at a lower price.
An instantaneous credit rating analysis
Open banking also allows for much faster and easier analysis of each customer’s credit rating. A simplified data collection and centralization process enables banks to gather the data they need much more efficiently than before. Therefore, customers can expect more swift and convenient credit services.
With open banking technology, there is no need to pay hefty sums of money to credit brokers. Applying for a loan and finding a bank that would suit customer’s needs and possibilities the best was never as fast and convenient. While in the past banks would have to collect needed information about the person from different institutions and perform tedious checks to ensure its validity, open banking allows doing all of that in minutes.
Article prepared by Nordigen.com
