UK FINTECH firms are embracing Open Banking and are reconsidering who they collaborate with as a result, new research claims.
A report from accountancy firm EY, released on Thursday, found that 59 per cent of UK fintech firms see Open Banking as an opportunity to review their collaboration strategies.
The survey of 31 UK fintech firms also found that 74 per cent of respondents believe that new competitors such as tech firms will become increasingly important over time.
The new data rules, which mandate high street banks to share anonymised customer data with approved third parties, came into effect in January 2018. Peer-to-peer lenders such as Zopa and Lending Works have already announced their plans to capitalise on the new initiative.
“It’s great that fintechs are embracing Open Banking and recognising the world of opportunities it will open up,” said Hamish Thomas, EY’s Open Banking and payments leader. “Such a significant initiative naturally means that many fintechs are re-looking at their strategies and analysing which types of companies could be potential partners in the future.
“However, whether it’ll be other emerging fintechs, more established banks, technology companies, or a combination of these, it will be fascinating to see what new products and/or services are launched over the coming months and years, which will transform our daily financial lives.”
The report also found that 81 per cent of UK fintech firms surveyed are getting ready for Open Banking, while 29 per cent of respondents said they were already fully prepared.
Their efforts are reflected in the number of staff employed to work on Open Banking-related propositions. 30 per cent of fintech firms surveyed said they had teams of 10 or more working on the data changes – a significant proportion for firms with a workforce of 50 to 250 employees.
“The talent within fintechs is there,” said Tom Bull, director in EY’s fintech practice. “Recruiting staff to roll out Open Banking is not seen as a huge concern, which speaks volumes for the innovation and skill that some of the UK’s top fintech firms already have within their four walls.”
94 per cent of fintech firms said they were focused on enhancing their current products and services and 81 per cent said they are planning to use Open Banking to build new services.