Open Banking 2025: Future Trends and Forecasts
Open banking is a significant development that enables secure data sharing and collaboration between financial institutions, technology companies, and customers. It breaks down traditional barriers in finance by facilitating secure collaboration and data sharing between all stakeholders. As a result, this empowers customers, fuels competition, and drives innovation in financial services. As per estimates, the value of open banking transactions worldwide will grow by more than 500 % between 2023 and 2027. It is expected to rise from 57 billion U.S. dollars to 330 billion U.S. dollars in this period. Did you know, that experts suggest that it holds the potential to make the financial ecosystem more inclusive, safer and customer-centric? Let us discuss some future trends to understand open banking’s impact better. Notable Open Banking Trends in 2025 You Must Know Open banking is a financial services model that uses application programming interfaces (APIs) to let third-party developers access data in traditional banking systems. It gives consumers more control over their financial information while service providers can improve their decision-making and offer customised solutions. In a way, this model changes the way financial data is shared and accessed. Let’s explore the emerging trends and future forecasts in open banking in 2025: Tightening Data Security and Privacy Norms Open banking and the increasing partnerships with technology partners can expose banks to more risks and cyberattacks. As generative artificial intelligence (AI) becomes more sophisticated, the threat of deep fakes is also growing, making it more challenging for financial institutions to discern human customers from those imitating their likenesses. By 2025, governments will devise stricter regulatory frameworks and advanced security technologies to deal with these fast-evolving threats and protect consumer data. Innovations such as biometric authentication, blockchain, and AI-driven security protocols are some of the technological innovations that will help safeguard customer data and protect against breaches. For example, U.K. government directives like PSD2 and the Open Banking Initiative are examples of regulators formulating guidelines to safeguard all stakeholders. Synergy of Open Banking and AI and ML Artificial intelligence and machine learning (ML) will continue to power the growth of open banking. Banks and fintech companies will be able to offer personalised services and proactive financial management advice leveraging these technologies. AI-driven chatbots and virtual assistants will become more prevalent, providing instant support and tailored financial recommendations. Similarly, as voice-activated AI assistants become more sophisticated, integrating them with open banking platforms will redefine consumer interaction with their financial data. Embedded Finance Will Become Mainstream Embedded finance is when financial services like loans or payments are seamlessly integrated into non-financial apps like buying something right within a shopping app. Going forward, companies from various industries will offer banking services as part of their product offerings. So, consumers can purchase insurance while booking a holiday package online or apply for a loan while shopping on an app. They can also enjoy a more convenient and integrated experience, blurring the lines between traditional financial institutions and other service providers. Open banking acts as the springboard for embedded finance. It represents an innovation opportunity no longer restricted to only the financial sector and will lead to a more interconnected financial ecosystem. Emphasis on Financial Inclusion Open finance has the potential to reduce financial gaps and enhance financial inclusion. CGAP study reveals data has the potential to be transformational for financial inclusion, and open finance can be the key to unlocking it. Data-driven financial services can help close inclusion gaps. CGAP research further suggests that despite income and gender-based differences, more low-income people (including women) are generating digital data trails than ever before. The growth of data trails presents an enormous opportunity to focus more on financial inclusion. By 2025, banks and FIs initiatives to extend banking services to unbanked and underbanked individuals will gain momentum. Data-driven financial services allow FIs to offer more varied and better-tailored financial solutions, including to previously unbanked or poorly banked customers. Evolution of Open Finance Open finance is the natural successor to open banking. Currently, it remains focused on sharing banking data; however, soon, this will expand to include a wider range of services, collectively known as open finance. Open data use will evolve beyond traditional banking products to include mortgages, credit cards, insurance, foreign exchange, retirement products, and cryptocurrency. This expansion will facilitate innovation and provide consumers with better financial management tools and personalised services. By 2025, FIs and banks will have a more holistic approach, enabling consumers to manage all their financial assets through a single platform. For example, Australia and India are looking at how data exchange goes beyond the financial sector to facilitate a more open economy, where data is shared across industries, including telecommunications, energy, and agriculture. Standardisation and Interoperability of APIs The lack of standardised APIs is one of the major challenges open banking adoption faces. Currently, different banks and financial institutions use diverse API standards, making it difficult for third-party providers to adapt to each API. To Sum It Up Open banking is facilitating the creation of a more competitive and user-centric financial services landscape. The model is widely recognised and well-integrated into financial ecosystems and will continue to grow stronger in 2025 and beyond. With financial institutions, fintechs, and regulators working together, consumers will benefit from improved choice, greater security, customised solutions and better financial wellbeing. This banking model relies on the use of APIs that provide access to the bank’s core system and data. Efficient use of APIs helps businesses and consumers enjoy easy access to custom banking services without compromising safety. Source: https://finezza.in/blog/open-banking-emerging-trends-and-future-forecasts/ About SAVYINT and the SAVYINT Open Banking solution SAVYINT is a trusted service provider leading the market and is in the TOP 10 leading IT companies in Vietnam. SAVYINT has successfully developed the SAVYINT Open Banking solution – a specialized system dedicated to the Finance – Banking sector, meeting legal and technological requirements to create connections and build a digital financial ecosystem. With a solid technological infrastructure and experience in deployment and operation, SAVYINT provides customers with advanced technology and the best user experience. The SAVYINT Open Banking solution
The Journey from Open Banking, to Open Finance and Open Data
The open banking ecosystem is developing strongly with significant and positive impacts on global finance; it is time for the world to witness the next chapters of open finance and open data. In fact, open banking emerged quite by chance. Previously, in the UK, when fintech companies were just entering the retail payment market, there were no specific regulations on how to collaborate or manage when parties were involved together. A study conducted by the UK Competition and Markets Authority (CMA) indicated that the retail banking sector in the UK was monopolized in this market. This research result created a push for the issuance of open finance regulations globally, aimed at improving competitiveness and economic development. From there, the concept of open banking was born, with specific provisions outlined in the PSD2 directive of the European Parliament, while concepts such as Account Information Service Provider (AISP – aggregating user data from multiple accounts) and Payment Initiation Service Provider (PISP – providing inter-account payment services) were also clearly defined. The emergence of open banking encourages banks to invest in API technology and develop partnerships with fintech organizations across Europe. Among them, Nordic banks were the first institutions to enthusiastically embrace this concept. Not all open banking models are the same When looking at the big picture, banks in the Nordic region have ample opportunities and technology to develop an open banking ecosystem thanks to the advancements of service providers as well as consumer acceptance. While in the Nordic countries, top banks fear losing customers and are quite quick to adopt advancements in open financial technology. Meanwhile, in the UK, users here are rather cautious due to fears of fraud, lack of personal data security, or unstable APIs, etc. An important factor contributing to success in the Nordic countries is that banks have become third-party service providers (TPPs) themselves, rather than allowing more innovative competitors to capture market share. A case in point is Danske Bank, which operates in all four major markets in the Nordic region with a payment application launched in the first half of 2018, and throughout the year, the banking interface between consumers and sellers was truly refined. Danske also allows customers to make payments from other banks within its banking app. These rapid transformations are made possible by several specific factors in the Nordic region, including the decreasing use of cash and the development of digital identity technology in the Nordic countries. In contrast to the Nordic region, at the same time in the UK, efforts to create open banking applications have not yet been widely accepted by users due to the barriers mentioned above. To overcome these barriers, the UK’s Open Banking Implementation Entity (OBIE) has created an app store for both users and businesses to search for and use financial services that complement their online bank accounts. Laws are not barriers but are put in place to support businesses serving users In many countries, the rapid development of technology outpacing legislation poses many challenges for both regulatory agencies and businesses: regulators struggle to establish an appropriate legal framework, while businesses face uncertainty about regulations, slowing down the process of delivering new services to consumers. However, the significant role of law in protecting users, safeguarding participants in the open banking ecosystem, and driving change and innovation cannot be denied. As pioneering data aggregation organizations in Europe – MoneyHub (established in 2009, UK), Bankin (established in 2011, France), and Spiir (established in 2011, Denmark) – have developed strongly to date. These organizations and their customers are strong evidence that users believe in the benefits of transferring money between accounts and making payments regardless of which bank their accounts are with. Additionally, there are other data aggregators aiming to maintain competition, ensuring that these transaction methods truly help consumers save time and reduce costs. In fact, when account aggregation apps added convenient payment features, the number of users increased exponentially. This shows the positive interaction between tech companies and regulators. In Northern Europe – where banks and fintech organizations have been ahead of regulators, leveraging APIs for a long time, not only for compliance with PSD2 regulations but also because these organizations want to create truly useful applications for users. Digital identification promotes open finance and open data In less transactional fields, such as the energy sector, digital identification helps accelerate the development of products and services as well as consumer adoption. Northern Europe is an example of applying digital identification in banking for commercial purposes. As a result, digital identification is quite commonly used in Northern Europe, helping to speed up the customer verification process; now, fintech companies not only compete with banks but can also compete with credit and debit card providers (who have weaknesses in storing customer information online). Overall, organizations and businesses outside the financial-banking sector should use digital identification. Because digital identification helps accelerate progress in all fields. Open data facilitates competition and drives innovation and creativity After a period of implementation and acceptance, open banking has developed faster than initially anticipated. Now, users can request banks to provide transaction history, identification images, and other information to any bank or third party they wish. Users can also easily change accounts, apply for loans, or register for credit cards with new providers. Additionally, users can manage their financial history on a single platform, without wasting time switching between applications. This journey is becoming increasingly attractive, as new players are also ready to join the “game.” In the future, organizations outside the financial sector will also use open data to provide highly personalized products and services based on users’ control over their own data. These “new players” will help users easily search for and be provided with necessary services that meet their needs. Any service that maximizes time and cost savings will succeed in the journey to win over users. Open data – Opportunities for leaders Accessing open banking and open finance from the perspective of regulators or users is not a problem that
Open Banking and financial inclusion strategy
1. What is open banking? Open banking allows third parties to access financial data such as current accounts, card accounts, savings accounts, loan information, and KYC information. In some markets like Europe, open banking also allows access to bank accounts to initiate payments, also known as open payments. Open banking is often associated with legal requirements that allow third parties to access bank accounts. This is most prominent in the United Kingdom, where “Open Banking is a national program implementing legal requirements for access to current accounts. However, open banking (or more broadly open finance) is also understood as the development of a new financial ecosystem based on connections between financial institutions and businesses, supported by APIs. Financial institutions are allowing fintech companies and other businesses to integrate financial services into their customer offerings, providing access to banking data and delivering full banking services through APIs. 2. The meaning of Open Banking and the factors driving Open Banking 2.1. The meaning of Open Banking Open Banking focuses on serving consumers, using API or SDK technology as the core foundation and operating within the financial ecosystem. Based on this definition, open banking has three main characteristics: data portability, customer autonomy, and the responsibility of the recipient. 2.2. Data portability The International Organization for Standardization (ISO) defines data portability as “the ability to easily transfer data from one system to another without having to re-enter the data.” Based on this definition, in open banking, consumers can share their relevant banking data with third-party service providers (TPPs), in accordance with “data portability.” Data portability in open banking is supported by standardized and compatible data technology, primarily APIs. 2.3. Customer autonomy Customer autonomy is the ability to consider and act based on reasons that are appropriate to the market context. This is a fundamental principle of liberal democracy, where marketers are allowed to influence customers but must respect their autonomy. Open banking empowers customers to control the sharing of their banking data, and this right is supported by the legal rights of customers to share data through open banking. 2.4. Responsibilities of the receiving party The open banking system requires third-party providers (TPPs) to be accountable to customers. Therefore, Fintech companies that receive banking data must be responsible for protecting this data from leaks, theft, etc. This is why closely managing TPPs through regulation is very important. Overall, these three characteristics of open banking reflect the goal of improving competitiveness, fostering innovation, and enhancing consumer protection. 2.5. Factors driving open banking a. Increasing customer expectations Customers expect seamless, instant services that provide added value to meet their financial needs. As consumers demand more personalized financial tools to improve their financial situation, financial institutions (FIs) will have to compete with fintech companies to maintain customer relationships and generate new revenue streams. Open banking and open finance allow financial institutions to leverage customer financial data to enhance customer experience and reduce administrative costs for processes such as account opening, mortgage application, and home loan borrowing. For example, HSBC allows intermediaries to share business account statements of self-employed mortgage borrowers through open banking, shortening the time from loan application to approval. Banks and fintech companies can develop innovative and personalized financial solutions in the payments sector, such as lending or personal financial management (PFM). This is a fertile ground: Over 90% of consumers in North America use digital applications to manage money, from products and services for simple financial tasks like bill payments or digital banking to more complex needs like financial forecasting, cryptocurrency investing, and crowdfunding. Worldwide, the movement demanding the transfer of control over personal data to consumers, especially data shared with third-party service providers (TPPs), is becoming increasingly strong. Therefore, service providers (such as banks, fintech) need to adjust their systems to allow customers to decide the data they share, including granting customers the right to permit (or revoke) data sharing and only allowing the recipient to use the data for SPECIFIC PURPOSES that the customer has agreed to. Open banking enables businesses operating in the financial sector to leverage customer financial data, after obtaining their consent, to develop innovative and highly personalized financial solutions. b. Open API connectivity is becoming increasingly popular With Open API, financial institutions (FIs) can expand their service distribution channels by collaborating with fintech companies. Open banking through APIs can be seen as the next step in the evolution of banks’ distribution models. By sharing data via Open API, financial institutions allow fintech companies to integrate this data into their applications. FIs can charge fintech companies for data usage or establish revenue sharing if the partner brings new customers to the FI. In this way, FIs create an ecosystem of third-party developers, providing innovative experiences for customers without having to develop everything in-house. Financial institutions (FIs) can also connect through APIs with other financial service providers and offer their products to customers. In this way, FIs can quickly bring new products from leading providers to market. As a result, the traditional value chain of banking and financial services is shifting from a single approach to a multi-party ecosystem. However, many financial institutions and large enterprises are still in the process of digital transformation. On the other hand, the infrastructure of fintech companies is designed with an API-first and cloud-based approach. The challenge for financial institutions is to modernize their infrastructure while meeting the rapidly changing demands of customers and complying with increasingly complex legal requirements. c. Customer identification has become a core element in business strategy Customer identification is one of the top priorities for businesses. Financial institutions (FIs) are striving to modernize their customer identification solutions. Some notable trends in this area include: Modernizing customer identification at financial institutions (FIs) is often driven by the desire to improve digital experience. This is not a new motivation, but the provision of multi-party services is creating challenges as the old identification systems of FIs hinder a seamless experience. Financial institution leaders are well aware that multi-party services are a
Europe pushes Open Banking: Mandatory UX improvements on banking apps
How you see and interact with your online bank accounts is about to change. That’s because Europe is forcing change into the financial market. Digital transformation is a thing this decade. “Digital disruption,” startups who want to be “the Uber of X” in their industry, and going “mobile first” are not new trends. But the banking industry has been slow to move with the times. New businesses have started to push into the European banking market. Yet progress has been slow, due to both regulation and customer inertia. Even though companies who focus on the best customer experience outperform the market. The pace of change in the banking industry will accelerate in 2018. Some new laws coming into effect are to thank. Why are things changing? European governments have decided that “traditional” banks are uncompetitive and slow. New banks find it very hard to break into the market. To do something about this, they have created some new legislation. This new legislation will force all banks to share a lot more digital information when their customers ask them to. As the above diagram shows, current core banking services will have a new digital interface added. This is called an API, or Application Programming Interface. It will allow third party “fintech” (Financial Technology) apps and services to get information directly from your bank. It’ll also add a new layer of tools on top. These fintech apps may be provided by your bank, or by external companies. All these changes must become law by January, 2018. In addition to the European legislation (PSD2), the UK has its own version (Open Banking). So this change will affect the UK regardless of Brexit. What differences will it make? This piece will focus on three of the biggest, broadest changes and how they will affect consumers. I will also follow up with a deeper dive into each change. There, I’ll discuss possible side effects as well as business opportunities. Direct bank account payments What are they? Right now, if you’re shopping online, you would most likely choose to pay with your debit card. The merchant (e.g. Amazon) has an acquirer (e.g. WorldPay) who coordinates with your debit card provider (e.g. Visa). They will then pull the payment out of your bank account (e.g. Barclays). That’s a lot of companies — and they’re all getting paid. The idea is that you, the consumer, can instead “push” a bank transfer direct from your bank (Barclays) to the merchant (Amazon). How it affects you, the consumer In the future, instead of entering all your card information, you’d grant Amazon permission to access your bank account. The user experience would be like logging into other websites with your Facebook account today. The first time, it will take you to your bank’s website and ask you to confirm your authorization. After that, the permission should stay active until you revoke it, so you can just click and buy. It will be interesting to see how this change affects all those other companies who were playing the middlemen. That will, of course, have an indirect effect on you. But it’s hard to say exactly what. Amazon’s costs should go down. Will they pass those savings on to you, or otherwise incentivize you to pay in the way that’s cheapest for them? Information sharing across all financial institutions What is it? Currently, the only way to get your bank information online is to log on to the website. Or perhaps they have a clumsily ported mobile website, packaged as an “app.” If you wanted to let another organization see your bank account, you’d have to give them your login details. This breaks the bank’s T&Cs, and would cause all kinds of issues in case of fraud or misuse. How it affects you By the new regulations, banks must provide a secure way for third parties to access your banking information. You will be able to consolidate all your information in one place, and see your ‘actual’ balance across all banks, accounts, and cards. Furthermore, you’ll be able to use that information in useful services. For example, some of the new “challenger banks” like Monzo or Starling can show you a breakdown of your spending. They can do it by category (e.g. restaurants), then by store (e.g. Nandos), then by transaction. They’ll even show you the location of that pub where you bought a round last night. Now imagine if you didn’t have to switch current accounts or wait for your bank to bring out something similar. You could just plug in to a service that collates it for you, from all your accounts and credit cards. After these changes, that should be possible and even simple. There are many possible applications for this type of information. Some examples include: personalized credit or budgeting advice; easier savings; easier current account switching (based on automated, personalized advice); better terms for loans or credit (in exchange for more access to your information for underwriting); easier personal tax returns, or small business accounting; third party fraud detection services you can use across all your cards and accounts; simpler and cheaper international transfers; and the list goes on. Let’s look at an example of the possible, unexpected side effects of the improved customer service and transparency banks can provide. There’s a great story here about how Monzo helped one customer get his stolen bag back the same night it was taken. There was even a bonus bottle of Jack Daniel’s included. Strong authentication for online payments What is it? Authentication is how the bank or payment provider knows that you are who you say you are. Given how much of your financial information they’ll be able to share, it’s critical that they use it securely. This is where authentication comes in. The new regulations will require multi-factor authentication in many areas. This will include every online purchase over €30. There are three commonly recognized methods of authentication: Using more than one of these methods together is “2-factor” or “multi-factor” authentication. How it affects you The average online
How does data work in open banking?
Open banking is a new financial ecosystem that allows users to securely share their personal financial data with third-party organizations, which can be fintech companies or other financial institutions. By sharing data, these organizations can provide personalized financial services to users. So how is open banking data being processed and what is it used for? Open banking: Managing user consent for data access (consent management) To provide and develop quality products and services, third-party providers (TPPs) need user consent to access their financial data, which is then filtered and processed for research purposes, and to build new financial products and services. Consent management is a sensitive issue that requires caution and understanding of legal and technical aspects. Contrary to popular belief, consent management is not simply clicking or checking the “Agree” box; it is a structured process that complies with regulations and directives in each region and country, such as the PSD2 directive or GDPR regulations in the EU. The approval management process in banking usually proceeds as follows: Some organizations may have different ways of expressing the agreement to access data, but this will be the most common mechanism, often used in: Understanding how data and information flow during the consent request process is a key factor in the transparency and success of organizations in open banking. The process of managing the approval of open banking data sharing The approval management process is typically divided into three stages: a. Agreement stage b. Verification stage c. Authorization stage Throughout the process, users are always aware of who they are granting data access to, for how long, and for what purpose. In particular, users can withdraw consent at any time. The information users are aware of typically includes: Open banking data sharing: How does it work? Open banking allows third-party financial service providers to access information with the user’s permission. Technically, this process is carried out through open APIs. Legally, the data sharing process is monitored and regulated according to current government regulations, such as the Payment Services Directive PSD2 in the EU or the Open Banking Act in the UK. However, these regulations vary by region, so the types of data shared through open banking services also differ. Typically, to ensure transparency and integrity, there will be multiple layers of security and verification in the data exchange process between financial institutions and third-party providers. The transmission of data from one side to the other is done in “an instant” thanks to APIs to ensure seamless, safe, and efficient communication. Who can access open banking data? Not everyone can access data in open banking. To view this data, consent from the user is required, and the third-party provider must also be licensed. Third-party providers must meet specific requirements before being granted access to the user’s financial information. Regulatory authorities will be responsible for granting access to user data for third-party providers, such as in Australia, where the Australian Competition and Consumer Commission (ACCC) is responsible for licensing open banking data. These authorities are responsible for ensuring that the sharing of personal financial data does not violate the law and can grant, modify, or revoke data collection licenses. What data is collected in open banking? The data collected by open banking service providers may vary depending on the regulations of each country/region as well as the type of services provided. Regulatory authorities often impose strict regulations on the type of information that can be collected, limiting the scope of data collection to ensure that third-party providers only access what is necessary. The most commonly collected data includes: How do open banks protect user data? In fact, data protection in open banking is a matter of great concern to regulatory agencies and financial institutions. Security measures implemented include: However, alongside protective measures, there are still some risks that developers and users are concerned about, such as: In summary, while it is impossible to completely eliminate risks, current security measures have been established to ensure that user data is safely protected in open banking systems. However, users should also protect themselves by using strong passwords, regularly updating software, and being vigilant against phishing attacks. Additionally, allowing users to manage open banking data is also a great way for users to take responsibility for when and how they want to provide their information. Third-party providers need to clearly inform about the purpose and the data that will be collected to ensure transparency and the privacy of open banking data. About SAVYINT and the SAVYINT Open Banking solution SAVYINT is a trusted service provider leading the market and is in the TOP 10 leading IT companies in Vietnam. SAVYINT has successfully developed the SAVYINT Open Banking solution – a specialized system dedicated to the Finance – Banking sector, meeting legal and technological requirements to create connections and build a digital financial ecosystem. With a solid technological infrastructure and experience in deployment and operation, SAVYINT provides customers with advanced technology and the best user experience. The SAVYINT Open Banking solution encompasses all the features to become a reputable standard platform in the Finance – Technology field: Open banking applications are the key to accelerating growth in the financial sector. Connect with SAVYINT now to leverage and experience the features and benefits of open banking today!
Open Banking: A driving force for small and medium enterprises
SMEs are an indispensable component in the economic development of a country, playing an important role in creating jobs for the workforce, increasing state budget revenue, etc. However, the story of access to finance for SMEs remains a difficult knot to untie in many countries. The emergence of open banking is expected to remove many financial barriers that SMEs are facing. The outstanding benefits that SMEs receive when participating in the open banking ecosystem Not only does it create a positive impact on banks, third parties, and users in the ecosystem, but open banking also brings significant benefits to SMEs. Better access to credit Small and medium-sized enterprises often face difficulties in accessing credit from traditional banks due to: lack of transparent and accurate financial data, lack of collateral, no audited financial reports… However, with open banking, small and medium-sized enterprises can share financial data with third-party providers – organizations capable of assessing credit history. As a result, these enterprises have the opportunity to access better credit sources from various financial institutions, especially suitable in the case of startups or those with limited credit history. Better financial management Open banking allows small and medium-sized enterprises to access multiple financial products and services simultaneously on a single platform. In addition, these enterprises can view all accounts, transactions, and financial data on one screen, one application. This way, small and medium-sized business owners can make better financial decisions and manage cash flow more effectively. More competitive prices Another positive impact that the open banking ecosystem brings is the competition in pricing of financial products and services. By leveraging the financial data of small and medium-sized enterprises, credit institutions can offer financial products that match the specific needs, scale, and sector of each business, meaning that businesses can access the best loan packages within their capabilities. Improved security and privacy To participate in the open banking ecosystem, an important requirement is that banks and third-party providers must comply with strict security standards according to international policies or the laws of each country. Therefore, the financial data of small and medium-sized enterprises is ensured to be safe, private, and protected from unauthorized access. Experience for small and medium enterprises when participating in the open banking ecosystem Understanding open banking Before participating in the open banking ecosystem, understanding the nature and operation of open banking is extremely important. Small and medium enterprises can start by reading articles, watching explanatory videos, and attending online seminars, then exchanging with other business owners who have participated in the open banking ecosystem and learning from their experiences. The more knowledge about open banking, the better equipped businesses will be to make smart and correct decisions. Choosing a reliable third-party provider When participating in the open banking ecosystem, small and medium enterprises will need to choose a third-party provider to manage financial data. Choose based on criteria: Check the list of partners, customers who have accompanied, projects that these providers have implemented,… You can start right now by looking for information on websites, customer reviews, and suggestions from businesses that have previously collaborated. Data security should be a priority When participating in the open banking ecosystem, data security should be the top priority. Small and medium-sized enterprises need to ensure that their financial data is protected from unauthorized access and theft by verifying whether third-party organizations have the right to audit, assess credit history in compliance with data protection and information security regulations. Start small and gradually expand When participating in the open banking ecosystem, small and medium-sized enterprises may feel overwhelmed by the integration requirements, the infrastructure – technical needs to be equipped, the data that needs to be shared, etc. Therefore, it is advisable to start with basic services such as payment solution integration and then gradually expand to more complex services like loans and credit. This will help businesses easily control and gradually familiarize themselves before comprehensive integration. Joining the open banking ecosystem is a turning point for small and medium-sized enterprises. Not only do they gain access to better financial products and services, but small and medium-sized enterprises can also manage their finances more effectively. However, to fully leverage the benefits that open banking brings, these businesses also need to equip themselves with knowledge about open banking, choose a reliable provider, prioritize data security, etc. By following these experiences, small and medium-sized enterprises can take advantage of the benefits that open banking offers while ensuring that the business can develop steadily without worrying about capital sources. About SAVYINT and the SAVYINT Open Banking solution SAVYINT is a trusted service provider leading the market and is in the TOP 10 leading IT companies in Vietnam. SAVYINT has successfully developed the SAVYINT Open Banking solution – a specialized system dedicated to the Finance – Banking sector, meeting legal and technological requirements to create connections and build a digital financial ecosystem. With a solid technological infrastructure and experience in deployment and operation, SAVYINT provides customers with advanced technology and the best user experience. The SAVYINT Open Banking solution encompasses all the features to become a reputable standard platform in the Finance – Technology field: Connect immediately with SAVYINT experts to start building an open banking strategy today!
Security challenges in Open Banking and solutions
The development of Open Banking brings many opportunities but also presents challenges, particularly in the area of security. So what is the solution to security issues in Open Banking? Let’s explore with SAVYINT in the article below. According to predictions by The Financial Brand, Open Banking is one of the eight fintech trends set to transform the banking industry. In Vietnam, Open Banking is becoming an inevitable trend and a key growth direction for banks. Open Banking is a unified model that enables the sharing of financial data between two or more third parties through Open API (Application Programming Interface) technology. In this model, banks collaborate with technology partners that offer innovative services and provide technology platforms to build a digital financial ecosystem that meets customer needs. Security Risks in Open Banking The openness of the Open API model raises significant challenges for the banking sector, with privacy and data security being the most prominent. Incomplete Legal Framework Open Banking is rapidly growing within Vietnamese banks. However, the legal framework for Open Banking is incomplete and lags behind the pace of technological development. Currently, there are no specific regulations guiding Open API usage (e.g., what data can be shared, how partners can use the data, under what standards, etc.), and there is no unified standard for IT infrastructure, storage, or security. As a result, commercial banks are applying different API security protocols. In this ecosystem, if any party uses an API protocol that is not robust enough, the risk of data leaks or theft is very high. Moreover, customers cannot be certain how their personal and financial information is being secured and used. Risks from Non-Banking Partners Open Banking allows third-party service providers to access users’ financial data. To expand their service ecosystems, banks will partner with technology companies offering innovative products and services. These partners often propose security measures to collaborate with banks, but in reality, few provide viable solutions. Strong infrastructure, technological expertise for implementation, and risk control capabilities are essential criteria that technology partners must meet. However, not every technology company can fulfill all of these standards. SAVYINT Open Banking Platform – Vietnam’s First Comprehensive Open Banking Solution Choosing a reliable and promising partner is a crucial issue for banks. Understanding the challenges faced by the banking sector, SAVYINT has developed the SAVYINT Open Banking Platform, a solution that addresses both legal and technological needs to connect and build a digital financial ecosystem. Financial-Grade API Security Standards The SAVYINT Open Banking Platform applies advanced security solutions, such as OAuth (RFC 6749, RFC 6750), and is a pioneer in providing Financial API protocols with secure JSON Data Schema structures that ensure: Strong Customer Authentication (SCA) – Identity and Access Management (IAM) This solution enables financial institutions and enterprises to quickly and securely identify and authenticate end-users across multiple platforms, minimizing risks in electronic transactions: Customized API Design Services The SAVYINT Open Banking Platform provides financial institutions and enterprises with a solution to optimize API resources. It offers a comprehensive, end-to-end solution tailored to the diverse needs of financial institutions and banks in Vietnam. Open Banking is the key for Vietnamese banks to accelerate growth and lead the digital transformation of the banking industry. Beyond preparing for potential input risks, banks need to research and select suitable partners with the highest international security standards. Contact SAVYINT’s experts today for immediate support!
Open API – The key to promoting open banking
The Open API has changed the way banks serve their customers, in order to improve the user experience and increase competitiveness in the market. This promotes the development of new operating models in the Finance – Banking industry, typically Open Banking. Why is Open API key to Open Banking? Currently, users are using too many applications for payment, financial management, shopping, authentication,etc. In other words, having to load a series of different applications at the same time causes users a lot of trouble and complexity in sharing data, managing reports or retrieving information. So, that has led to the increasingly widespread use of APIs as well as integrated applications namely Open Banking. The main purpose of the Open Banking API is to create a unified model that allows financial data to be shared between two or more third parties. Widespread use of Open APIs, banking institutions form a true API ecosystem; providing the best customer experiences thanks to the ability to combine the digital services of multiple providers in one application. Users can access a variety of financial products and services directly connected to the financial databases of banks. Along with the development of the Industrial Revolution 4.0, more and more consumers use products and services from Fintech. Therefore, instead of competing, cooperation with Fintech companies is essential for the bank to stay ahead of new technologies to provide attractive services to its customers. This approach forces banks to establish an open API architecture that facilitates the plug-and-play integration of banking and Fintech services, ultimately creating banking app stores with multiple utilities and services. “Open Banking” – Open Banking using Open APIs is becoming a new trend. Open banking creates opportunities to form diverse integrated financial and non-financial services, generate new revenue sources for financial institutions, and expand customer base with a secure ecosystem of data sharing applications. Open API application for Savyint Open Banking Solutions: A comprehensive solution system for Open Banking Pioneering and accelerating strongly on the digital transformation race, SAVYINT has been ahead of the Open Banking trend. In addition to launching Savyint Open Banking Solutions specifically designed for the Finance – Banking industry, meeting the legal – technological needs to connect and build a digital financial ecosystem, SAVYINT also connects and cooperates with prestigious organizations and enterprises on Open API in Vietnam and around the world to develop an open ecosystem with Open API such as DX Open Healthcare Platform (Open Health), DX Open Gov (Open Government),… Some of SAVYINT’s leading partners in providing Open API and Open Banking solutions: With a solid technology foundation and infrastructure and partners with experience in implementing and operating the world’s leading Open API, SAVYINT will provide customers with the most advanced technologies and optimal user experience. Contact SAVYINT today to help your organization lead the way with Open Banking!
Remote Signing – An irreversible trend
Since the COVID-19 pandemic, the need for remote work, online shopping, and digital communication has skyrocketed. As a result, the demand for secure digital signatures has grown exponentially. Remote Signing has emerged as a game-changer, transforming the way we sign and manage electronic documents. Digital signing with USB Token is no longer an optimal choice Digital signatures, akin to personal signatures or company seals, hold legal weight and significantly enhance efficiency. However, USB token-based digital signatures have several drawbacks, including limited compatibility, device dependency, and lack of mobility and scalability. Remote signing is the perfect alternative Remote Signing offers a superior solution, providing efficient, flexible, and secure electronic transactions. Unlike traditional methods, the private key for Remote Signing is securely stored in a service provider’s data center. Nevertheless, activation processes are rigorous, ensuring that even the service provider cannot activate or sign on behalf of the customer. In addition, Remote Signing offers numerous advantages, such as: Sign anytime, anywhere Remote Signing allows users to sign documents anytime, anywhere, without relying on physical devices like USB tokens or SIM cards. Users can sign directly on any mobile device, such as laptops, smartphones, or tablets. High security Remote Signing provides an exceptionally high level of security and reliability. The mechanism ensures that only the authorized user can activate and use the digital signature. Even the service provider cannot intervene in the activation or signing process without the customer’s authorization. Moreover, seamless integration with timestamping and long-term validation technologies (LTV, LTANS) enables the detection of any changes to the document, maximizing data integrity and preventing fraud and forgery in electronic transactions. Batch and bulk signing Users can sign multiple documents simultaneously through automated processes, eliminating the need for manual signing of each page. Easy integration with advanced digital signature technologies SavyintTimestamp, long-term validation, and long-term archiving (LTV, LTANS) can be easily integrated into this model. SAVYINT is proud to be the first trusted service provider in Vietnam to comply with the eIDAS regulation for remote signing services, setting the highest standard for security, reliability, and confidentiality in electronic transactions. This means that SAVYINT’ remote signing services are widely recognized in 27 European Union countries and are the first to provide a full range of services, from basic digital signatures to advanced and long-term validation signatures. In October 2021, we were granted a license by the Ministry of Information and Communications to provide remote signing services and became the only entity to fully comply with all mandatory technical standards and advanced digital signature standards, including long-term validation (AdES) as stipulated in Circular 16/2019/TT-BTTTT on remote signing models. QTSP Remote Signing – The perfect solution for individuals and businesses for electronic document signing. Contact SAVYINT today to own a quality remote signing solution!
eKYC solution using HyperLedger Fabric
The Central Bank of Bahrain (“CBB”) has has launched the eKYC by financial institutions in the Kingdom as part of its initiatives for digital transformation in the sector. The eKYC solution built by Bahrain BENEFIT utilizes hyperledger Fabric Blockchain platform. The platform was built in collaboration with Avanza Innovation company. The national eKYC platform, which was the first of its kind in the region targeting retail banks, financial services providers and money exchange networks, is operated by BENEFIT in collaboration with the Information and eGovernment Authority (IGA) and under the supervision of the CBB. The platform provides a national digital identity database for financial institutions to securely verify the identities of their customers, validate their information and share data digitally before providing products and services. This includes retrieval of customer data from governmental entities including IGA. BENEFIT has also developed the Application Programming Interface (“API”) for the platform, which allows for seamless integration with financial institutions core systems, digital channels and mobile apps. With the introduction of Open Banking in Bahrain, this also provides an opportunity for fintech companies to verify customers identities through their online and mobile applications. Mr. Khalid Al Hamad, Executive Director of Banking Supervision at the CBB said “The CBB urges all licensed financial institutions to avail of this innovative and streamlined service and accelerate its efforts towards automating the maintenance of its customer data and reputation records, by implementing eKYC API integration with their core systems, digital channels and mobile apps. We continue to support technological advancement in the sector to minimize cost while also fostering innovation and integration between financial institutions and fintech companies. This is also in line with the CBB’s continuous efforts in developing the financial sector infrastructure in light of the Covid-19 repercussions to ensure appropriate solutions for electronic payment systems.” BENEFIT’s Chief Executive Officer Abdulwahid Janahi said “It gives us great pleasure to continue developing the eKYC platform in an effort to drive digital transformation in the Kingdom’s various sectors. We have succeeded in enabling the integration of this digital platform into core banking systems and smart phone applications, and we are pleased to announce that Bahrain Islamic Bank has successfully integrated this platform into its core banking services system, while “ila” Bank offers customer on-boarding in a completely digital and autonomous manner through its mobile app, both based on eKYC API integration. We look forward to the use of eKYC services on a larger scale during the coming period.” The Vice Chairman of eTransformation in the Information & eGovernment Authority (iGA), Dr.Zakareya Ahmed Alkhaja, confirmed that iGA cooperated with “BENEFIT” that implemented the technical development of the project, under the supervision of CBB. The project aims to provide an advanced comprehensive eSystem for financial entities to verify the identity of their customers and the validity of the information, before providing the financial services. He pointed out that the authority has started providing identity verification services to the government sector, and this project complements providing the services to the private sectors, especially the banking sector, as the project will allow the it to start providing innovative, high-quality, secure data services that keep the privacy of individuals. That will lead to enhance economic growth and expand commercial activities in the Kingdom. He expressed his pride that the (eKYC) project is the first of its kind in the region and the first at the level of global applications in terms of cooperation between the government and the banking sector, as the implementation of projects globally is limited to cooperation between banks in the private sector. This project is also one of the first Projects using Block Chain technology in the Kingdom of Bahrain. Source: https://www.unlock-bc.com/news/2021-02-01/central-bank-of-bahrain-launches-hyperledger-fabric-ekyc-platform-with-benefit/