The age of open banking is well underway. Today’s digital consumers want control of their finances; secure, convenient payments; seamless account opening; and loans approved instantly so they can plan their future.
Open banking makes this possible — and consumers are embracing this option by consenting to securely sharing their financial data to access enhanced, personalized data and payment services.
To gain even greater insight into business and consumer views of open banking, Mastercard and the Harris Poll recently conducted a survey in the U.S., U.K., Nordic and Australian markets.
The survey delves into open banking usage and momentum at large, including drivers and barriers to adoption, top use cases for today and tomorrow and the most important factors to consider when choosing an open banking partner.
Explore some of the highlights of the research below or download the full report here.
Open banking adoption is widespread
Open banking has been widely adopted by both B2B and consumer users, amid a strong appetite for improved digital financial experiences — establishing this technology as a crucial component of future business growth. Our research showed that:
- 76% of consumers connect financial accounts directly to tools to conduct financial tasks.
- 85% of businesses use open banking and are optimistic about its continued growth.
- 93% expect industry momentum to increase in the coming five years, and 91% believe their firm’s use of open banking will grow over that time, with 92% agreeing that “open banking is essential for future-proofing my organization.”
Convenience drives open banking use
Across use cases, convenience is a compelling reason for consumers and businesses to leverage open banking, with time savings ranking as the number one driver.
The top B2B open banking benefits are time savings, using real-time data to improve financial management, cost efficiency, improved access to credit and the ability to make more informed strategic decisions to reduce business risks.
The top consumer open banking motivators are saving time, seamless payments, tracking transactions between accounts and tracking financial information in one place, saving money and facilitating simpler loan or credit applications.
Convenience and an optimized experience are major drivers of open banking — 73% of consumers want more convenient financial experiences, while 93% of businesses acknowledge that providing customers with greater convenience is critical to commercial success. Indeed, 71% of consumers would walk away from an online transaction that takes them to another platform to complete a payment.
The efficiency of open banking is helping B2B users deliver improved business outcomes: 64% say open banking has helped improve profitability and 63% say it has had a positive impact on revenue.
Building trust is vital
Trusted partners who prioritize security are central to future open banking growth. Today, established banks and credit card companies are most trusted by businesses and consumers for having the expertise and innovation to lead in the space.
Consumers trust sharing their financial data with banks (66%) and credit card companies (56%). The entities they most trust to protect account connections are credit card companies (50%).
Businesses want open banking partners who prioritize trust and security. The top motivator for a business entering an open banking partnership is trust, followed by security. Similarly, B2B respondents say the top barrier to working with an open banking partner is concerns about protecting customer data, followed by concerns about protecting company data.
To build trust, open banking providers must continue to assure both B2B and consumer users that their data is protected and backed by an innovative partner who is always evolving to safeguard the ecosystem.
Meeting user expectations
For the open banking ecosystem to reach its full potential, consumers need to feel confident that their data is secure. They desire choice, control and personalized experiences, but these benefits can be realized only if they trust that their data is protected. The Mastercard survey reveals a clear message: without trust, customers and businesses will walk away and seek other financial partners.
With new regulations emerging in regions such as Australia, Europe and the U.S., data privacy and security policies are more important than ever. Adopting best practices will provide consumers and businesses with the confidence to share their financial information.
At Mastercard, we believe consumers and businesses should own their data and have the right to control it and benefit from it — and it’s our duty to protect it. Our commitment to trust is embedded in our Data & Tech Responsibility Principles. We hold ourselves to the highest standards, with privacy and security at the heart of everything we do.
Commenting on that, Jess Turner, Global Head of Open Banking and API at Mastercard, says:
“Across the industry, we must work together to advance open banking in ways that responsibly support all parties in the ecosystem, ultimately allowing all boats to rise.”
Download the full report to get more insights into the current state of open banking or head over to our home for everything open banking.
