May 12, 2020
Open Banking & Australia: Enhancing Service Offerings with APIs
Financial services in Australia have seen more disruptive technologies introduced over the past three years than any other industry. With the rise of COVID-19 and other major disruptions to the market, including the Australian bushires – banks are moving fast to meet customer demand and upcoming Consumer Data Rights compliance measures to be implemented on July 1.
To meet customer expectations for on-demand delivery, banks must look beyond digitizing existing services and establish open banking platforms for connected digital services.
In this blog series we will be deep-diving into competitive advantages for banks adopting Open Banking standards. One of the key competitive advantages banks can implement include enhance service offerings.
Enhance Service Offerings with Open Banking APIs:
One cannot underestimate the fundamental role of APIs in Open Banking initiatives. In the new ecosystem of Open Banking, APIs are an opportunity to open up new services for customers and internal teams.
However, these APIs can also create a threat for banks by opening doors to fintech firms, who may leverage this data to extend their own offerings as well. As experts in open banking solutions in Australia, we see the most successful banks taking this as an opportunity to progress and growth, rather than thwart fintech competition.
By opening up their APIs, banks are able to easily connect other APIs in the market and services in order to extend their service offerings. This helps banks to extend their service offering without covering the overheads of development and maintenance which is essentially a staff and operational cost reduction.
Quick thinking banks can often white-label a fintech solution as their own, by opening up their API data, to still keep their customers within their network. This again, benefits the business by not having to invest in their own technology builds that may be slower-to-market.
Examples of such APIs include the Experian Connect API, which provides customers the ability to see their credit score in real-time through their existing bank account, or Pocketbook which tallies customer spending and budgeting through an easy-to-use interface. Banks have visibility over this data to help make decisions over lending or future product sales.
Yes, there is threats to the banking viability through Open Banking. For example, a fintech service bank’s customer API data in order to build one mobile application where customers budget their finances, manage their debt, and get real-time investment and financial advice through chat. With their large siloed services and slow infrastructure, the majority of traditional banks do not offer such debt and real-time finance management services these days. However, this is another opportunity for banks to innovate quickly and implement agile changes.
In order to establish their position within the value chain, banks must not turn a blind eye to these initiatives. In fact, fintechs are already creating such services by leveraging existing APIs or building their own through insecure methods such as screen-scraping. In order to capitalize on this opportunity and improve their customer security, as well as solidify their position as the central data and banking source, banks must better address this threat by owning this existing relationship and enhancing their own products and offerings through innovative partnerships.
Banks and financial institutions in Australia face a looming July 1 deadline to meet Open Banking and CDR compliance legislation this year. But, when it means making a significant change to your business strategy, internal systems and technology infrastructure, Australian organisations can fall behind. In this webinar, we’ll be discussing covering:
The Reality: Where Australian financial institutions stand in their open banking journeys
The Problems: What challenges they are facing
An Ideal Scenario: Critical success factors for a winning open banking strategy and implementation
The Requirements: Capabilities internal and external required to excel in open banking
Tuesday, 26th May at 1.00pm AEST
About Innovo Technology & MuleSoft Open Banking Solution:
At Innovo, we’re a development and software testing organisation with experience working with external standards and payments processing systems. We’ve recently partnered with MuleSoft to help Australian finance, insurance and superannuation organisations overcome the CDR and Open Banking challenges.
Our solution involves the application of experienced Open Banking architects and developers who work on a pre-built Innovo & MuleSoft solution that is more than just an API. With an integrated layer of people and technology, our solution is taking pre-configured and customised, and quickly deployed – allowing your business to hit regulatory deadlines and in delivering a solution which is fit-for-purpose now and scales for the future.
The platform provides API hosting, Developer self-service portal, Identity Management (including strong authentication), a testing environment that mimics production behaviour, and the ability to integrate to an internal integration bus in either on-premise or cloud environments.
The Innovo solution is built on proven market leading MuleSoft technology, with all the integration and customisation required to deliver an Open Banking solution already done for you and available OTS.