Open Banking: New rules that require banks to share information with third party providers come into effect.
This weekend sees the launch of Open Banking, a new initiative that will force the UK’s nine largest banks (Barclays, Lloyds, HSBC, Santander, Nationwide, Danske Bank, Bank of Ireland and AIB) to give their customers more control over their data so they can share it with other financial institutions.
Essentially, Open Banking is a set of technologies and standards that allow third party providers to securely access personal bank details through APIs.
This is a boon for innovative fintech providers and “challenger” banks and should allow customers to get better deals.
The government is calling it a “technological revolution” that will boost competition and aid consumers who can pick and choose from numerous different providers rather than taking all of their services from a single provider.
Indeed, it is claimed the new rules, which come into force on Saturday 13 January, will save overdraft users an average of £180 a year and current account holders an average of £92.