Financial services membership body TISA has urged the industry to advance its Open Savings, Investments & Pensions (OSIP) initiative via open finance technologies.
Open finance allows people to share their data with third parties which can help them understand their situations quicker and more conveniently to help them take control of their money and get the help and advice they need.
OSIP is an initiative led by TISA to create set application programme interface (API) standards for savings, investment and pensions products.
It builds on open banking which enables consumers to share their current account data with third parties to access new products and services. Fintechs and other financial institutions are given access to savings, investment and pensions data via APIs.
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A consumer can choose to share information about their financial products with a personal financial management app giving them a single overview of their financial position.
This visualises projections of their financial position, nudges them into positive money management behaviours and refers them to advice when it looks like they need it.
TISA said OSIP has the power to help people get an improved return on their savings and investments and access to financial help and advice earlier.
Read more: More small businesses are using open banking
The membership body is working with industry members to develop and roll out OSIP and is calling on the industry to help build the necessary infrastructure to make this a reality.
TISA highlighted how the Covid-19 crisis has made this more important. It cited the Bank of England household spending report which found that 42 per cent of high-income households saved more during the pandemic, compared to just 22 per cent of low-income households.
“Open banking apps have already helped people set aside money to a savings account,” said Harry Weber-Brown, digital innovation director at TISA.
“Round-up savings or micro-saving small amounts is helping people on low incomes start saving for the first time and see that investing is possible. OSIP enables industry to go beyond open banking by providing standard and accessible APIs to accounts not currently required by regulation.
“As a result, individuals can compare accounts more easily, automatically switch to a better rate, automate their savings or make more informed trade-offs about whether to save, invest, spend, borrow or consolidate.
“OSIP facilitates a wide range of advice services too. For instance, apps can nudge people towards getting financial advice earlier, perhaps for the first time. OSIP gives an adviser easier ways to fact-find and keep track of their clients’ situation.
“We are calling upon the industry to participate to build a truly holistic infrastructure for the UK.”
Peer-to-peer lending platforms that are TISA members include: Zopa, RateSetter, Folk2Folk, Fund Ourselves and Lending Works.
Some P2P platforms which use – or plan to use – open banking include Lending Works, RateSetter, Leap Lending and Rebuildingsociety.