As we edge closer to 2024, the open banking landscape is brimming with potential, making predictions more exciting than ever. It's a world constantly reshaped by technology, consumer needs, and regulatory shifts. Let’s dive into what we foresee for open banking in the coming year.
A Surge in Open Banking: More Than Just Numbers
Open banking isn't just growing; it's evolving into a powerhouse. In the UK, we've seen numbers skyrocket, where the volume of open banking payments double in 2023 compared to the previous period, and 1 in 9 consumers are using open banking today. The Nordics are also not far behind, where Account-to-Account payments captured a significant share of online payments and projections point to further growth on the horizon. But it's not just about the statistics; it's about the stories behind them. Governments are getting on board, people are becoming more aware, and what used by to be a niche tech talk is becoming a dinner table conversation. By the end of 2024, we expect open banking to be a more integral part of financial life, woven into the fabric of daily transactions.
Trends and Predictions for 2024 and Beyond
Looking ahead, we anticipate several emerging trends in open banking. The integration of APIs is expected to become more sophisticated, providing seamless and secure data sharing. The regulatory landscape will become even more supportive as European governments prepare to implement the coming PSD3/PSR/FIDA1 legislation, bringing both challenges and opportunities for innovation. In the Nordics and the UK, we foresee open banking expanding beyond just payments and payment account data to include a broader range of financial services.
Digital Identity: The New Frontier
The digital wallet is expected to evolve beyond mere payment facilitation to become a repository for essential personal documents such as ID cards and health insurance. This shift underscores the importance of interoperability and user control in digital identity management, propelling a move towards a more connected and efficient digital life.
Omnichannel Retail Payments
Retail payments are poised to also become more sophisticated, with a focus on integrating payment systems across all consumer interaction points. Expect advancements in omnichannel experiences, including the seamless blend of online and in-store shopping, that cater to the modern consumer's expectations for convenience and efficiency.
The Changing Face of Payments
Remember when cards were king? Those days are fading. As open banking rises, traditional payment methods are facing greater competition against open banking players offering more efficient, secure, and cost-effective solutions that cards struggle to match. We're not saying it's the end for cards, but the competition is definitely heating up.
The Cost-of-Living Crisis: A Catalyst for Efficiency
With wallets feeling tighter, open banking is emerging as a beacon of hope. It's not just about saving a few pennies; it's about smarter financial management. Open banking offers a more cost-efficient transaction process for businesses and consumers alike, promising greater cost-efficiency than traditional payment methods, personalized financial management, and more control for the user.
User Experience: The Heart of Open Banking
In 2024, how you feel about your banking app is just as important as what it does. The key to open banking's success lies in its ability to delight users. It's about creating connections that are not just fast and convenient but also enjoyable. Companies that get this right are the ones to watch.
Neonomics: Your Partner in the Open Banking Journey
At Neonomics, we’re not just building technology; we’re crafting experiences. We're focused on making open banking accessible, secure, and enjoyable. In 2024, expect to see more from us – innovations that simplify and make payment transactions more secure, with access to secure financial data and services faster for both businesses and consumers.
As we look towards 2024, open banking is set to redefine how we interact with our finances. It's a world of possibilities, brimming with innovation and driven by user needs. In this dynamic environment, one thing is certain: open banking is not just a future cornerstone of financial services, but an opportunity that you and your customers can substantially benefit from now.
Want to learn how your business can benefit from open banking payments and data? Let’s talk!