Adoption of open banking will boost innovation – Expert

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CARLOS Figueredo, Chief Executive Officer, Open Vector, says the adoption of open banking will boost innovation in the country.

Figuredo made this known during the first edition of the FINTECH Week 2019 held in Lagos.

He said that Open banking is the practice of sharing financial information electronically, securely and only under conditions that customers approve of.

According to Figueredo opening banking is the biggest revolution in the financial sector since the creation of credit cards.

He said that financial services firms were waking up to the value of Open Banking initiatives and the fundamental role of Application Programming Interfaces (API).

NAN reports that API is a set of subroutine definitions, communication protocols and tools for building software.

Figueredo noted that traditional banks understood that in order to better compete in the industry they must develop their digital capabilities to avoid being dis-intermediated by new entrants with superior offerings and service.

“The purpose of open banking is to create more competition and innovation in the financial industry and also to disrupt the monopoly of top large banks.

“It increases competition by leveling the playing field for the challenger and online banks by implementing standards for its data to be shared on open application programming interfaces (API’s)” he said.

Figueredo said that adopting open banking would create collaboration between regulators, Fintechs and financial institutions.

He said that the transformation that open banking would bring to the financial industry would be more impactful than interbank transfer as it frees banks and Fintechs to expand their sphere of innovation tremendously.

Figueredo said that for customers, Open Banking was created to offer choice and greater control across all their bank accounts.

According to him, through the open banking system, customers who want to share information or make payments will need to give their explicit consent to the third parties whose services they want to use. (NAN)

– Apr. 24, 2019 @ 19:55 GMT |

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