Open banking has been a hot topic in the financial industry for several years now. Its promise to revolutionize how consumers interact with financial institutions has sparked both excitement and skepticism. At a recent panel discussion at Unchain Festival 2024, industry leaders gathered to discuss the current status and future prospects of open banking.
The panel kicked off with Cosmin Cosma, co-founder and CEO of Finqware, introducing himself and the participants and expressing his enthusiasm for discussing the state of open banking. He was joined by Kamil Szymanski from Tink, Stepan Kouba from Blockmate, and Niklas Sandqvist from the European Digital Finance Association, each bringing a unique perspective to the table.
The Current Landscape of Open Banking
Kamil Szymanski, representing Tink—a leading open banking platform now owned by Visa—shared his experiences in the Central and Eastern European markets. He highlighted the significant strides made over the past few years, emphasizing the rapid growth and adoption of open banking services. Despite the challenges, Szymanski painted an optimistic picture, noting the increasing number of consumers and businesses leveraging these services.
Stepan Kouba from Blockmate provided insights into the digital assets market and the regulatory environment. He mentioned the collaboration between banks and startups as a significant achievement, something unforeseen five years ago. Kouba also pointed out the importance of initiatives like bank ID, which, though not widely recognized as an open banking product, plays a crucial role in the everyday financial lives of consumers.
Niklas Sandqvist, representing the European Digital Finance Association, echoed the sentiments of his fellow panelists. He underscored the importance of usability and consumer convenience, suggesting that the future of open banking lies in seamless, integrated services that consumers use without even realizing they are engaging with open banking technologies.
Expectations vs. Reality
Cosmin Cosma brought up a critical point about the expectations set back in 2019 when PSD2 (Payment Services Directive 2) was implemented. Many anticipated a revolution in the banking sector, but the reality has been more of a gradual evolution. Szymanski responded by emphasizing the phenomenal growth seen in user numbers and the range of services now available, suggesting that while the revolution might not have been as dramatic as expected, the progress has been substantial.
Challenges and Solutions
One of the key challenges discussed was the reluctance of some banks to fully embrace open banking. A question from the audience highlighted this issue, particularly in regions like Bulgaria, where banks have been resistant to change. The panelists agreed that regulatory pressure and demonstrating new revenue streams from open banking collaborations could be effective in overcoming this resistance. Stepan Kouba added that showing tangible financial benefits to banks could persuade them to adopt open banking more readily.
Looking Ahead
The discussion concluded with a look towards the future. The consensus among the panelists was that open banking will continue to evolve, becoming an integral part of the financial ecosystem. They envisioned a future where open banking applications are ubiquitous, and their use cases are widely recognized and appreciated. Kamil Szymanski expressed optimism that next year’s discussions would focus more on specific use cases and success stories rather than the concept of open banking itself.
In summary, the panel provided a comprehensive overview of the current state of open banking, acknowledging the challenges while celebrating the achievements and potential for future growth. The key takeaway is that open banking has set the stage for significant advancements in the financial industry, promising a future where seamless, integrated financial services enhance consumer experiences and drive innovation.
(Cover photo: Depositphotos)