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The Paypers’ Open Banking Report 2021: our 5 Key Takeaways

3min Read · 28 Oct 2021

On October 7th, The Paypers released its annual Open Banking Report, which showcases the evolution of the sector as it inches closer to Open Finance. LUXHUB is proud to have been featured in it. Discover below a summary of the interview conducted with our CEO Jacques Pütz, as well as our 5 key takeaways from the insightful report.

 

How LUXHUB aims to help all companies take advantage of Open Banking opportunities

In the fast-emerging era of Open Banking, financial institutions are confronted by both an increased number of European regulations and an ever-expanding plethora of digital-led opportunities.

To navigate and succeed in such an environment, they are required to deeply transform to stay relevant.

This transformation is crucial for retaining existing customers and attracting new ones – by satisfying their rapidly changing needs and providing unique, innovative, flexible and easy-to-use services.

Last September, LUXHUB was granted both AISP and PISP licences from the CSSF. Those, combined with the Fintech’s PFS status, positions LUXHUB uniquely at the intersection of legacy and digital innovation within the financial services industry. Jacques explains:

“AIS enables end-users to check real-time account balances, access enriched and segmented transaction data and reference historical and consolidated data from multiple banks within a single app or interface.

“On the other hand, the non-regulated entities that will use this solution will have the opportunity to build unique added-value services, responding to the new needs of their end clients”.

On the other hand, PIS is all about enabling more seamless digital payments – without the use of a credit card and even without having to open a banking app or other online payment interface. The CEO highlights:

Customers can now easily and rapidly process payments directly through the service they are currently using. Again, the PIS enables frictionless experiences and will increase the conversion rates of those providing such services to its clients.

 

5 key takeaways

  1. According to a recent research conducted by Accenture, 76% of banks worldwide expect customer adoption and Open Banking API usage to increase by 50% or more in the next three to five years.From lending, to payments and personal finance management, Open Banking-powered services will enable consumers and businesses alike to enjoy new and better options to decide which financial products they need.
  2. TPPs still need to solve many challenges so that the successful implementation of Open Banking in Europe can continue.For instance, as highlighted by Ralf Ohlhausen, Chairman of ETPPA, “the European Commission’s API Evaluation Group was right: we need to find ways to get all these APIs to work.“My recommendation is: 1) remove all the EBA-recognised obstacles as soon as possible, 2) amend the RTS to mandate all the missing minimal functionalities, and 3) establish the SEPA API Access Scheme, which incentivizes banks to go beyond the minimum and allows TPPs to avoid bilateral contracts with thousands of banks to access premium APIs.”
  3. As explained by Mounaim Cortet (Senior Manager Strategy, INNOPAY), “bank executives should take note of the following three recommendations as they embark on their transformation journey:1) Acknowledge that the role of Data Custodian is crucial to ensuring future relevance for banks in the digital economy,2) leverage existing capabilities and participate in standardization initiatives (where relevant) as banks transform towards Data Custodians and3) future-proof the operating model to move from strategy to execution.”
  4. In its Open Insurance Monitor, INNOPAY underlines that API marketplaces offer a variety of different API services from different providers, thus functioning as a one-stop-shop for organizations that are looking to strengthen their capabilities through external APIs.The marketplace serves as a single integration layer, thereby reducing the implementation headache.
  5. “New analysis from Accenture, built on data sets covering 20 of the largest economies responsible for over 75% of global GDP worldwide, suggests that as much as USD 416 billion in revenue will be at stake as the Open Data wave arrives.“Value is already being created through key innovation plays by incumbents and industry newcomers,” says Amit Mallick, Global Open Banking/Open API Lead, Accenture.

 

Download the report

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