New report reveals how lenders can best attract customers via Open Banking

MONEY-SAVING product recommendations are the best way for lenders to capitalise on Open Banking, new research has revealed.

A study from Equifax found that 40 per cent of Brits who are willing to share their bank transaction data with a new lender would do so if it opened them up to new product developments that would improve their finances.

Other motivations to share their bank data included the ability to easily compare products from different financial institutions (36 per cent); being offered tailored incentives for switching to a new provider (34 per cent); and a streamlined process when applying for mortgages (28 per cent) and loans (25 per cent).

Open Banking mirrors the EU’s Payment Services Directive II (PSD2), mandating high street banks to share anonymised customer data with approved third parties, which can include peer-to-peer lenders.

“Since the implementation of Open Banking at the start of the year we’ve seen widespread product developments among banks and fintechs alike, as market players recognise the scope of opportunities available,” said Jake Ranson, chief marketing officer at Equifax.

Read more: PwC: Open Banking is £7.2bn revenue opportunity, but more disruption is needed

“New products and solutions such as HSBC’s credit application offering have come to market, showcasing the real-life consumer benefits the initiative can deliver.

Read more: Bud launches Open Banking API

“Open Banking is moving the sector forward to the digital world and it’s an exciting time. As the rate of product launches accelerates awareness will continue to grow, providing the uplift in consumer engagement needed for the project to be truly transformational.”

Read more: Open Banking toolkit launches