This is a guest post by Daniel Kjellén, CEO of Tink.
The financial industry has been standing at the precipice of this major shift. Some banks have taken the leap – innovative thinkers and leaders embracing the data revolution and using it to deliver amazing services. For those who’ve waited, now is your time – to take a leap, redefine how consumers manage their money and seize a once-in-a-lifetime opportunity to change banking for the better.
The final PSD2 deadline on 14th September was the last moment you could stand and wait. And now that it’s passed, the time for change is here.
Europe has taken a historical leap to democratize access to financial data, allowing customers to share theirs with any business that offers them the best services. The change will take time. But everyone in the industry is making a choice if they haven’t already.
And the choice is this: you can either join this data revolution and be an indispensable player in this historical shift – or wait on the sidelines while a tidal wave of change hits the industry.
A brave new world of banking
Open banking is the start of a two-decade-long transformation. Banking’s “Spotify moment” is here – the technology is ready, consumers are ready, and PSD2 has rubber-stamped the change.
While the banking industry has been a bit slow to act, a huge opportunity for you lies ahead. And it’s massive in scope. Trillion-dollar industries at the very core of banking – investments, mortgages, pensions – will be up for grabs.
Now that the playing field is being redrawn, bankers have the opportunity of a century.
Rather than posing a threat to your existing business, what open banking really offers is the opportunity to build a new one. One that can meet the modern demands of consumers, leverage technology – not only to deliver better experiences but to reduce the costs of doing so – and to build a foundation that will prepare you to maintain your dominance for decades to come.
The colossal amounts of data you have access to is turning into a priceless resource for value creation. And that’s why now is the most exciting and rewarding time to be a banker.
In this brave new world of banking, you will get the customers you deserve — not just the ones you’ve inherited. As some innovative players have shown, there are few limits in an open and digital world. Instead of launching a money management app just for your own base, you can leverage open banking tech to invite the customers of 20 competitors to your platform. Then use data insights to make them yours forever.
In this data democracy, customers have the final vote – and they’ll choose the best quality of service. It’s a competition for relevance.
The fintechs of the world have proven just how fast customers will snap up a frictionless and more intuitive service. How robo-advisory is redefining how consumers manage their finances. How smooth onboarding and seamless switching can be used to attract new users, and how data can be used to unlock customer value.
Everybody can join this revolution because open banking will open up a new age of collaboration. And with their scale, resources and customer base, the smart banks stand a good chance of leveraging their position by partnering up with nimble and tech-savvy newcomers.
A simple choice
This is the opportunity of a lifetime to redefine financial services. And you can control your fate by taking action. The banks with a relentless focus on customer value can get ahead of the rest. But the ones who get stuck in the old ways risk irrelevance. With time, the window for jumping on this opportunity will close.
The winners will be those brave enough to experiment and build services that delight customers. And the reward will be enormous – to be one of those who make history and remake banking for the better.
For more insight on open banking from Tink, check out the Tink company blog.