Open banking needs to allay consumers’ security worries

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December 11, 2021

Open banking needs better consent handling to allay consumers' security worries

Banks and third-party financial-services providers can revamp how they manage consumers' consent for sharing the data needed to underpin open banking, per a new PYMNTS report that outlines an international landscape.

A 2021 Axway survey of US consumers found that 47% of consumers worried about losing control over their financial data access, and 27% worried that the data would be used against them.

In response, PYMNTS outlines various steps that banks and third-party providers can take to improve how they approach users' consent for data sharing, which include proactively including opt-out features, including expirations for consent, and moving away from passwords.

Open banking's growth will be stymied unless consumers feel empowered to handle their financial data and trust that it will be handled appropriately by companies. Improving consent handling will help them leap over this hurdle.

Insider Intelligence's Tom Auchterlonie has the full story.

BRIEFING HIGHLIGHTS

Dropped from US defense bill, cannabis banking still has long-term momentum

federal legislative provision that would allow US banks to serve cannabis businesses has been excluded from an updated version of the 2022 National Defense Authorization Act (NDAA), per Banking Dive.

Open banking budgets must be sustained through 2022

Forty-seven percent of financial services executives said their budgets for open banking technology increased in 2021, per a survey by the open banking platform provider Tink.

American Express and Nova Credit tie-up extends credit access to US immigrants

American Express expanded its partnership with startup Nova Credit so US immigrants can use their home-country credit history to apply for Amex cards, per a press release.

A bevy of digital payments regulations could hit Australia as the government looks to retain control over the space

Australian Treasurer Josh Frydenburg announced several regulatory proposals covering popular digital payment methods like cryptocurrencies, buy now, pay later (BNPL), and mobile wallets, per ZDNet.

Awash in cash for now, neobanks will need to show investors a new strategy

Monzo bagged $475 million to reach a $4.5 billion valuation in its latest round, per the Financial Times.

Funding rounds for Kueski and TradeDepot reflect growing BNPL appetite in underserved markets

Two installment lending players announced funding rounds to expand their financing solutions in markets that remain largely untapped by buy now, pay later (BNPL) incumbents.

BIS has a bone to pick with decentralized finance 'illusion'

The Bank for International Settlements issued a report on the risks that decentralized finance (DeFi) carries for consumers and the broader financial system.

66% of UK consumers now aware of cryptocurrencies

Two-thirds of UK consumers (66%) say they are aware of cryptocurrencies, and 29% of those who are aware of them have invested in them—demonstrating that cryptos have become part of the financial services mainstream, per a Coinbase 2021 survey.

Credit card applications reached pre-pandemic levels this year—but uncertainty could complicate matters for issuers

In October, 26.5% of US consumers said they applied for a credit card in the past 12 months—up from last October's 15.7% of consumers who said the same, according to data from the New York Federal Reserve.

Klarna targets desktop online shoppers with rewards-centric browser tool

Klarna launched a browser extension that enables buy now, pay later (BNPL) for online shoppers even if Klarna isn't partnered with the merchant, per a press release.

RESEARCH IN FOCUS

US Mobile Banking Emerging Features Benchmark 2021

A strong mobile experience is critical for today's financial institutions (FIs), given consumers' heavy reliance on that channel: 87% of adult US mobile banking users we surveyed in September said that mobile is the primary way they access their checking accounts. This fifth annual study stacks up 23 FIs against one another, evaluating their mobile app capabilities based on consumers' demand for 42 emerging features. This benchmark highlights the most in-demand emerging mobile banking features an FI can offer to attract users. It evaluates 23 FIs across six feature categories and weights their scores according to the results from a survey of US mobile banking users. The findings pinpoint product development priorities for mobile banking apps.

Get the full report →

Insider Intelligence's Fintech Trends to Watch in 2022

Fintech has reached new heights of funding and adoption, accelerating digital transformation across the financial services industry. Players big and small are scrambling to get ahead of the trends that will make or break growth in the coming year. This report answers questions such as: Has the fintech funding wave hit its peak? Will Big Tech encroachment in financial services impact banking and insurance? How will consumer demand for hyper-personalization reshape banking and payments experiences? How will digital brokerages find new revenue streams as they face margin pressure? And will crypto finally go mainstream?

Get the full report →

Insider Intelligence's Payments Trends to Watch in 2022

Payments are set to break physical and digital borders in 2022, connecting the world in more ways than ever. This report covers how state-sponsored central bank digital currencies (CBDCs) impact the payments landscape in their respective markets, who is the best positioned to gain from the rise of buy now, pay later (BNPL)—and how regulation will impact their trajectory, what the rise of super apps means for payments titans looking to maintain or grow their share of the space, and why payments providers are attracted to sub-Saharan Africa.

Get the full report →