WHY Open Banking System Is A Win-Win Situation For Both Customers And Banks- Details Ahead!
The following article clearly delineates all the door to possibilities an open banking system can offer
With the introduction of Unified Payments Interface, popularly known as UPI, the entire banking business process system went through a modification- delinking debit instructions from banking accounts. Such a simple alteration broke down complex banking processes into easy formats making it real-time for consumers, revolutionizing pre-existing norms of online banking.
The success of this platform and other such unconventional banking innovations also stands credited to the adoption of the Open Banking system. From the standpoint of inclusive growth, real-time payments, when integrated into open banking, eventually can drive financial inclusion.
Alterations remoulding the financial services industry offer prominent banks in Asia-Pacific a window of opportunities to adapt to technologies which can strive to increase their competitiveness and agility. While looking at the future of banking, it is merely not just about IT modernization or creation of an efficient mobile banking app, it’s about projecting banking evolving into new models that are self-regulating, accessible and platform-based to accelerate digital transformation and deliver delightful customer experience.
According to the recent State of Enterprise Open Source Report, 93% of financial services organizations established the fact, that open source technologies are strategically integral while thinking of current and future plans.
Open banking system can lead to unlocking outdated systems of banks using modern technologies like containerization and microservices. Through provision of modern, microservices-rooted architecture, banks can acquire the degree of understanding adopting continuous integration and continuous delivery (CI/CD) to build, deploy and manage applications quickly.
Secondly, open banking provides ample authority to customers to choose from a wide range of applications developed by third parties to seek their own financial benefits. It equips financial institutions with the recourse to customize these applications to specific individual preferences and requirements and enabling financial institutions to innovate and develop at their own speed.
Moreover, since a single customer record can encompass varied finance-related transactions linked to it, banking systems focusing largely on application programming interfaces (APIs) can enhance multiple activities coupled with a single customer record.
Banks have further the capacity to ameliorate operational efficiency by employing an API integration tool, externally facing APIs and connecting it with the internal banking APIs and systems of record. It reconstructs and administers requests to the appropriate endpoint within the IT environment, allowing modifications to the back-office without impacting customer engagement services.