UK Open Banking Passes 1 Billion Payments

Open Banking Limited reported in a progress update published this month that more than one billion payments have been made in the UK through open banking and that application programming interfaces have handled 100 billion requests. The figures cover activity across banks and third-party providers that use APIs to share customer-permitted data.

The update recorded an improvement in operational performance, with average response times for payment requests falling by about 50 milliseconds to 349ms. The organisation attributed the change to system refinements as usage increases.

Open banking allows customers to grant permission for external firms to access account information or initiate payments via APIs. The framework originates from the Competition and Markets Authority’s 2017 Retail Banking Market Investigation Order, which required UK banks to implement open banking standards to increase competition.

The report includes economic analysis by EY, commissioned by Open Banking Limited. EY estimated open banking has already generated about £8.2bn in economic benefits for the UK, could add roughly £7.4bn a year within five years, and might reach about £43bn a year when the system reaches full maturity and open finance use cases are enabled.

Open finance would extend current API sharing beyond bank accounts to products such as mortgages, loans and other retail financial services, allowing external providers to offer services alongside banks.

Henk Van Hulle, chief executive of Open Banking Limited, described the milestones as reinforcing the UK’s position in open banking and said the organisation will concentrate on strengthening resilience, performance and innovation to deliver further value for consumers and businesses.

At an industry event in February, Ron Kalifa, former chief executive of Worldpay, warned that the UK had “laid the rail track, but hesitated to run the trains,” arguing open finance has not yet been widely adopted. He pointed to countries such as Brazil and India as advancing their own open banking and open finance systems.

Open Banking Limited’s update shows rising use of permissioned data sharing across the UK financial system and lists priorities including expanding services, improving resilience and raising performance as adoption grows.