The launch of the Global Open Finance Challenge has caught the attention of the fintech market. In a recent conversation with Finextra, NatWest Group highlighted the reasons behind introducing the initiative and the inclusive incentives being used to attract the best teams.
CIBC, Itaú Unibanco, National Australia Bank and NatWest Group have partnered to host a virtual event due to take place in October 2021 and is focused on delivering a stronger, more advance banking and finance industry. With support from Amazon Web Services (AWS), four major banks are encouraging the best innovators to launch large-scale new customers solutions. Each bank provides shared APIs, with a combination of open banking, open financing and experimental services. Teams will then have the chance to test, build and validate their solutions.
Paul Thwaite, the CEO of commercial banking at Natwest Group, explains that API’s have already proven to be vital for business and corporate customers, enabling open banking payments and reducing cases of fraud.
Daniel Globerson, the head of the bank of APIs at NatWest Group, explains that his position alone highlights that open banking is a significant area of opportunity. While many institutions viewed open banking as something to comply with, NatWest Group regarded it as an opportunity to create products and services in new and innovative ways. It represented a chance to collaborate with new and emerging fintech, to strengthen customer relationships and improve the overall user experience.
Globerson believes that open finance is just another step on our journey towards smart data. Worldwide, we are experiencing a growth of open banking, customer data rights and other regulations to support innovation, competition and ensure the customer remains in control of their data.
Open finance can offer businesses more creativity in meeting customer needs by leveraging new data sources and creating a more comprehensive picture of customer financers. Having a complete picture of financial health is a vital step in really understanding what customers need. Banks are more than just accounts and payments, but also institutions of trust. There is an opportunity today for financial institutions to build trust and improve the overall customer experience.
While opportunities within banking and open finance exist, Globerson refers to the position financial institutions are in and are trying to hold in an environment that is more open now to innovation and agile businesses. Globerson believes financial institutions are in a unique position where they have built trust from customers with data and privacy and a safe store of funds.
While many institutions have been operating for many years, the fact that groups like NatWest have not focused on monetising data in return for services provides a real competitive advantage. It’s critical that banks are trusted with data and privacy and that financial success doesn’t focus on monetising the data of individuals in return for offering the services. By leveraging this level of trust and longevity, combined with innovation and new partnerships, financial institutions are very capable of competing and progressing in this new finance world.