Open banking signals a remarkable shift in the business of banking. It embodies a creative disruption of the banking business, leading to a rearrangement of priorities and focus on consumer needs and changing expectations, leveraging data in a system built on open APIs.
At its core, open banking aims to simplify the way customers interact with banking services, encourage seamless collaboration among key participants in the emerging banking ecosystem, and define new value-levers for all stakeholders. In the wider society, open banking stands to play a socio-economic role of addressing the needs of the underserved and unbanked segments of the society.
Driven by several factors, the open banking phenomenon is reshaping the banking landscape on a global scale. Some of the key driving forces are changing customer needs and expectations, rise of ecosystem models, innovation in the industry, competition, regulation, etc.
While there has been considerable milestones achieved in the journey towards open banking globally, there is still a long way to go. Open banking is interpreted in diverse ways by different stakeholders, resulting in varying perspectives on its nature, functional attributes, requirements and solutions. To some, open banking holds enormous potential to transform the banking sector while to others; open banking is a mere catchphrase, which will fizzle out eventually.
Open Technology Foundation recognises the need for all stakeholders to appreciate the developments in open banking, especially from a Nigerian perspective. Therefore, this report was put together to inform stakeholder perspectives about open banking in the right direction, provoke the right questions among key ecosystem players while addressing the needs of those who are still trying to figure out the open banking phenomenon.
The report provides an overview of open banking, key open banking developments around the world so far, the extent of progress achieved in Nigeria towards an open banking regime, the technology and guiding principles behind open banking in Nigeria and what the industry says about open banking developments.