Open Banking has the potential to improve the way in which consumers manage their finances. However, two years on from its introduction, Which? has found nearly three quarters (73%) of people still haven’t heard of Open Banking.
Of the just over one in four people (27%) who had heard of Open Banking, only 4 per cent have used an Open Banking ‘account aggregator’, allowing them to view multiple financial accounts in one app.
The research also found that nearly seven in 10 people (65%) are unlikely to consider sharing their financial data even if it meant that financial products and services were more tailored to their needs.
The main reasons for being unlikely to share financial data were:
‘I am happy with my current banking arrangements so don’t see a need for an Open Banking product’ (64%)
‘I am concerned about the security of my personal/financial details when shared with a third party’ (41%)
‘I am concerned about data privacy’ (41%)
‘I am not prepared to share my data with third parties’ (40%)
‘I prefer just to deal with my own bank’ (27%)
Open Banking has the potential to improve the way in which consumers manage their finances, however vital protections over data breaches and scams must be in place.
Industry must work to deliver useful and innovative products and services for consumers if Open Banking is to be a success.
Banks and regulators must have in place robust measures and provide the necessary assurances for consumers over their data privacy and security.
Jennya spokesman for Which?, said:
“By giving consumers greater control over their finances and more choice over the products and services they use, open banking has the potential to be revolutionary. But two years on, huge numbers of people are still in the dark over what open banking is, or are reluctant to use it.
“If open banking is to ever be a success, regulators and industry must do more to deliver services with clear, tangible benefits for consumers, and demonstrate that customers are properly protected from data breaches and scams in order to boost trust in these services.”
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