Accenture Research: Most Large Global Banks Planning Major Investments in Open Banking
October 16 2017 - 3:59AM
Business Wire
Half believe competitive pressure will force
them to give data-access to third-parties as a service to
customers
All but one of 100 payments executives at large banks said their
bank plans to make major investments in Open Banking initiatives by
2020, according to the results of a global study by Accenture
(NYSE:ACN).
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Open Banking is an emerging service model that allows customers
to share access to their financial data with non-bank third
parties, which can then use that data to provide the customer with
a better banking experience. Banks can also use the Open Banking
platform to offer plug-and-play financial products to third
parties, such as retailers or fintech companies, ultimately
expanding their reach to new customers.
The survey found that nearly two-thirds (63 percent) of banks in
North America believe that implementing Open Banking is critical to
competing with new entrants – such as fintechs and tech giants –
and will help banks remain relevant, compared to half (51 percent)
of executives surveyed in Europe and two-fifths (40 percent) in
Asia Pacific. In fact, half (52 percent) of all the bank executives
surveyed believe that they will be forced to implement Open Banking
in order to compete with traditional competitors (i.e. other large
banks) that have invested in digital transformation.
“Unlike banks in Europe where it is mandated by regulation,
those in North America and Asia Pacific have the luxury of deciding
if, how and when they will implement Open Banking, and we expect
many will do so as a way to more easily offer integrated financial
services to customers,” said Alan McIntyre, a senior managing
director at Accenture and head of its Banking practice. “As
European banks ready their networks for compliance, banks across
the globe are identifying opportunities to drive new revenue
streams by offering services to third parties, such as consumer
credit checks and identity management, enabled by Open
Banking.”
In Europe, Open Banking is being driven by the Revised Payments
Service Directive (PSD2), a regulation taking effect January 2018
that will enable consumers to share their financial data securely
with banks and third parties, making it possible for them to more
easily transfer funds, compare products and manage their accounts
without their bank’s involvement. While Open Banking is a
regulatory requirement in Europe, market competition is driving
North American banks to a high-level of interest in implementing
Open Banking.
According to the study, two-thirds (66 percent) of bank
executives believe that Open Banking will help create new revenue
streams for their organization, and 90 percent expect it to drive
incremental revenue growth of up to 10 percent.
Most bank executives surveyed believe that Open Banking provides
more an opportunity than a threat and makes it easier for consumers
to access their products. However, many also believe that Open
Banking will introduce more interfaces, leading to potential
security and fraud vulnerabilities. Survey findings include:
- More than two-thirds (71 percent) of
respondents at European banks view Open Banking as more an
opportunity than a threat, versus 63 percent in Asia Pacific and 60
percent in North America.
- The majority (71 percent) believe Open
Banking will make it easier for customers to access more targeted
banking products and offers.
- According to the results of the survey,
some banks can already distribute third-party banking products to
consumers with whom they do not have a primary relationship: 37
percent in North America, 29 percent in Europe and 23 percent in
Asia Pacific.
- Half (50 percent) of all respondents,
and nearly two-thirds (63 percent) of those in Europe, believe that
implementing Open Banking will increase the level of risk in the
banking industry.
“Open Banking provides myriad opportunities for banks to
generate new revenues and offer new products; however, it also puts
banks at risk of becoming back-end, transactional players, with
their products and brands buried deep in another transaction,”
continued McIntyre. “Banks have an opportunity to use their trusted
position with consumers to own the customer relationship, and
provide the seamless digital experience customers want and that
Open Banking enables.”
Visit www.accenture.com/OpenBanking
Methodology
Accenture Research surveyed 100 payments executives familiar
with Open Banking at large banks globally (>$5 billion in
revenue for banks in North America, the UK, Spain, Italy, France
and Germany; >$3 billion in revenue for banks in Asia Pacific,
and other European markets) to determine their appetite and plans
for implementing Open Banking. The online survey was conducted Aug.
8-28, 2017.
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About Accenture
Accenture is a leading global professional services company,
providing a broad range of services and solutions in strategy,
consulting, digital, technology and operations. Combining unmatched
experience and specialized skills across more than 40 industries
and all business functions – underpinned by the world’s largest
delivery network – Accenture works at the intersection of business
and technology to help clients improve their performance and create
sustainable value for their stakeholders. With approximately
425,000 people serving clients in more than 120 countries,
Accenture drives innovation to improve the way the world works and
lives. Visit us at www.accenture.com.
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AccentureMelissa Volin,
+1-267-216-1815melissa.volin@accenture.com
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