The financial services industry is undergoing a seismic shift, driven by the advent of open banking regulations such as PSD2 in Europe and the UK’s Competition and Markets Authority (CMA) initiatives. These regulatory frameworks mandate that banks expose their data and services through secure APIs, enabling customers to share their financial information and initiate payments via trusted third-party providers (TPPs). This transformation is not just a compliance exercise—it is fundamentally reshaping the competitive landscape, customer expectations, and the very nature of banking itself.
Open banking marks a departure from the traditional, closed model of banking, where institutions controlled customer data and dictated the terms of engagement. Today, customers are empowered to own their data, choose their financial partners, and demand seamless, personalized experiences. This shift from a “Bank First” to a “Life First” paradigm is forcing banks to rethink their business models, technology strategies, and customer engagement approaches.
The regulatory push for open banking is only the beginning. Consumer and business expectations are being shaped by experiences in other sectors—instant, highly personalized services that fit the way people live and work. As a result, banks now face competition not only from fintechs and neo-banks, but also from technology giants, retailers, and even utility providers, all eager to leverage financial data to deliver new value propositions.
Open banking enables banks to move beyond traditional product silos and embrace platform-based business models. By exposing APIs, banks can create multi-sided platforms that facilitate collaboration with fintechs, merchants, and other ecosystem partners. This opens up opportunities for:
Open banking puts the customer at the center of the financial ecosystem. With access to richer data and a broader range of services, banks can:
By adopting open APIs and modular architectures, banks can accelerate the development and deployment of new products and services. Agile engineering practices, cloud-native platforms, and data-driven insights enable rapid iteration and continuous improvement, helping banks stay ahead of evolving customer needs and regulatory requirements.
While the opportunities are significant, the journey to open banking is not without its challenges. Financial institutions must address complex issues across technology, compliance, security, and organizational culture.
Implementing open banking requires a robust, secure, and scalable API infrastructure. Banks must:
With increased data sharing comes heightened risk. Banks must:
Open banking is subject to evolving regulatory standards. Institutions must:
Open banking demands a shift from product-centric to customer-centric thinking. Success requires:
Leading banks are already demonstrating the transformative potential of open banking. For example, by collaborating with technology partners to design and implement API management platforms, institutions can align with regulatory requirements while enabling new digital experiences. The creation of “systems of engagement” that bring data and insights directly to customers and colleagues is enriching personalization and driving loyalty.
Moreover, the adoption of cloud-native core banking platforms and modern API strategies is reducing time-to-market for new features, improving operational efficiency, and enabling the rapid launch of innovative products. These advances are not only meeting compliance mandates but also positioning banks to thrive in a connected, customer-driven future.
The open banking journey is complex, but the rewards are substantial for those who embrace it with the right mindset and capabilities. Financial institutions must view open banking not as a regulatory burden, but as a catalyst for digital transformation and sustainable growth.
At Publicis Sapient, we bring deep expertise in strategy, engineering, data, and experience design to help banks navigate the open banking landscape. Our holistic approach integrates modern technology platforms, robust security and compliance frameworks, and a relentless focus on customer value. By fostering ecosystems of innovation and partnership, we empower financial institutions to unlock new opportunities, deliver differentiated experiences, and build the resilient, future-ready organizations that the open banking era demands.
Ready to explore how open banking can transform your institution? Connect with our experts to start your journey.