Thought Leadership

OBL meets Scottish fintech leaders and firms to discuss open banking and smart data

02 October 2024

Last week, Open Banking Limited (OBL) held its latest regional visit in Edinburgh as part of the wider FinTech Scotland festival.

Hosted in partnership with Fintech Scotland, which aims to boost the fintech economy through innovation, collaboration and inclusion, the roundtable brought business people, fintech experts and business leaders together for a productive and future-focused discussion.

The wide-ranging discussion set out the need to fast-track the Digital Information and Smart Data Bill through the UK Parliament, how open banking can help consumers and businesses with everyday financial services, and how to encourage the adoption of secure data-sharing schemes.

A large part of the discussion focused on how industry can effectively communicate the benefits of data-sharing to consumers, such as streamlining time-consuming activities such as mortgage applications and borrowing which, in turn, can offer wider access to finance, cost savings and efficient money management.

Henk Van Hulle, OBL CEO, outlined the success of open banking to date: “Today, we’re at 11 million users, six and a half years young, and this is a very young sector: from open banking, open finance and open data to open everything. The industry is worth £4 billion to the economy, and one out of seven consumers and one out of five SMEs are now using it.”

Looking ahead, Henk said, “We believe that in the future, you will have a whole series of schemes, data sharing schemes, it could be payment schemes, as well as other, different, schemes.”

“We know open banking, and open finance, is an important topic for us as we think about future innovation, and we know the industry are very thoughtful about that as well.”

Nicola Anderson, CEO at Fintech Scotland

One key topic was the important role that open banking and open finance can play in the home-buying process and the mortgage journey.

Martin Leonard, Chief Commercial Officer at mortgage valuation platform Dashly, highlighted the important role open banking data has played in enabling affordable lending, particularly to the financially vulnerable.

He went on to explain that, similarly, securing a mortgage involves long fact-finding sessions, but that using other property-related data points, from credit bureaus, for example, can speed things up for both consumers and lenders. He also emphasised the importance of continued collaboration between banks and credit bureaus to streamline the mortgage application process.

Avril Fiddes, Portfolio Lead, NatWest Bank of APIs, focused on the customer experience and consumer demand. She said: “Perhaps the missing part of the jigsaw is the consumer demand, pushing the industry to go faster, to collaborate more, to deliver more.”

“…Part of the communication challenge we’ve got is to step away from acronyms and actually tell people, ‘wouldn’t it be great if you could get your mortgage approved at five clicks’?
Who wouldn’t sign up to that?”

Avril Fiddes, Portfolio Lead, NatWest Bank of APIs

Adam Betteridge, Partnerships & Open Banking Lead at TSB Bank, highlighted the challenge around consumers understanding the value exchange for data, suggesting that if some of the major banks came out with a TV advert for an open banking service in the next couple of years, it would help bring the financial innovation to life.

He also pointed out the importance of open banking for businesses.

“We’re really interested to see the growth from the small business sector – and work with innovative start-ups which can greatly boost banking services for consumers. TSB’s Edinburgh-based Innovation Lab currently has 13 open banking fintechs that are launching their solutions with us.”

Adam Betteridge, Partnerships & Open Banking Lead, TSB Bank

Tina Harrison, Professor of Financial Services Marketing and Consumption, Edinburgh University, said: “I’d also like to think about the ongoing relationship with customers, something we’re thinking about with [alternative lender] Salad Money.

They have that data for a period after they’ve made a loan to their clients, and thinking through the consumer duty lens, are there ways in which that data could be used to proactively engage with customers over time? For example, if you start to see changes in their financial circumstances, and how that data can then help to improve the relationship and the circumstances of those clients?”

She also pointed out that many credit unions also use open banking for credit decisioning.

Nicola Anderson went on to explore future opportunities for open finance and smart data in the wealth management and pensions sectors, before summarising the session’s key strategic asks: digital identity, the mortgage journey, and consumer communication.

Meeting local politicians

While we were in Scotland, the OBL team was also pleased to meet with Miles Briggs, Scottish Conservative and Unionist Party MSP for Lothian, Christine Jardine, Liberal Democrat MP for Edinburgh West, and Ben Macpherson, Scottish National Party MSP for Edinburgh Northern and Leith, to discuss the value of open banking and smart data schemes to the wider economy. The team also has a meeting scheduled with Chris Murray, Labour MP for Edinburgh East and Musselburgh.  

It’s clear from our latest visit that Scotland is continuing to play a leading role in building a thriving UK fintech sector and delivering many of the tangible benefits of open banking to consumers and businesses in the country.

OBL would like to thank all attendees at the roundtable for their time and expertise:

  • Nicola Anderson, FinTech Scotland
  • Adam Betteridge, TSB
  • Bryn Coulthard, Smart Data Foundry
  • Yizhe Dong, University of Edinburgh
  • Avril Fiddes, NatWest (Bank of APIs)
  • Fiona Fenn-Smith, OBL
  • Rob Henry, NatWest (Bank of APIs)
  • Felix Honecker, University of Glasgow
  • Tina Harrison, University of Edinburgh
  • Alex Henderson, Seccl
  • Henk Van Hulle, OBL
  • Martin Leonard, Dashly
  • Graeme Marsh, OBL