UK open banking passes 1 billion payments

Open Banking Limited reported that open banking payments in the UK have exceeded one billion transactions and that systems have processed 100 billion requests to application programming interfaces. The organisation said average response time for payment requests is 349 milliseconds, about 50ms faster than previous measurements.

The open banking framework was created after a 2017 order from the Competition and Markets Authority requiring major banks to provide customer-permitted access to account data via APIs. The goal of the rules was to allow third-party firms to build services that use customer data with consent, including account aggregation, faster payments and new financial products.

An economic analysis commissioned by Open Banking Limited and carried out by EY found the UK has so far realised about £8.2 billion in benefits from open banking. The study estimates the sector could deliver roughly £7.4 billion a year within five years and rise to as much as £43 billion a year when open banking expands into broader open finance services covering mortgages, loans and other products.

In a statement, Henk Van Hulle, chief executive of Open Banking Limited, called the figures evidence of the UK’s leadership in open banking and said the organisation will concentrate on improving resilience, performance and innovation as the network grows.

Ron Kalifa, author of a 2021 government fintech review, warned that policymakers and industry should accelerate the next phase of development and noted that countries such as Brazil and India have moved quickly with similar initiatives.

Open finance aims to use APIs to share a wider set of financial data beyond basic account information. Proponents say access to standardised data could allow lenders and other firms to assess applications or build new services, while regulators and industry bodies will need to manage security, consent and oversight as more data flows through APIs.

Open Banking Limited highlighted recent operational improvements, including faster response times and increased API volumes, and listed upgrades to resilience and performance as priorities as new use cases emerge and more firms connect to the network.

The organisation and the EY analysis both state that realising the projected economic gains will depend on continued investment in technical standards, infrastructure and consumer trust.