We discussed this question with Brad Goodall, Founder of Banked. Listen to the audio version of this conversation here: https://apple.co/2LXVOyp
Open Banking was hands down one of the most relevant fintech themes in 2018, with legislation taking effect in Europe and the UK and being replicated and expanded in countries like Australia.
But so far, we've seen anything but tangible impacts from Open Banking on products, services and customer experiences.
To start with, banks dragged their feet in terms of implementation, and startups have been unable to deliver the cross-platform experiences they imagined.
We've also taken a narrow view of what Open Banking means and how it will be leveraged.
What impact will Open Banking have?
Brad sees Open Banking as an opportunity for much of banking to shift away from traditional financial services providers and over to consumer brands more relevant to customers. His company, Banked, is building the infrastructure to manage Open Banking access by companies inside and outside of finance.
In the world Brad envisions, access to financial services in a few years' time may come via the consumer brands we know and love, who will have leveraged Open Banking to provide extra value to customers and in doing so won more trust. Open Banking, as Brad sees it, will shift the delivery point of financial products further away from the originating banks and out to the brands people already engage with. Does this sound plausible? Let us know in the comments below.
What happens to banks?
What would the impact be for banks if Brad's vision plays out? By adopting proactive strategies, banks can consolidate positions as trusted hubs and data repositories, backed by implicit or explicit government guarantees of stability.
If financial data truly becomes accessible and transferrable across companies and industries, the design of the current financial product manufacturing and distribution model could fundamentally change. At first, the Internet seemed like a shared file system. Three decades on, it has fundamentally changed the way economies and societies work. Are we at the start of a similarly transformational period for banking? Does open access to banking data provide the foundation required to support massive new, data driven industries beyond the perimeter of traditional finance?
Depending how big brands position themselves, fintech could quickly become relevant well beyond financial services.