Open banking: an opportunity for the financial centre
Changing customer needs, new stakeholders and innovative technologies are posing challenges for traditional banks. In light of the increasingly fragmented value chain through which customers are being served by a large number of different financial services providers such as banks, fintech companies, neobanks and service providers from other industries, it is no longer a question of whether open banking will establish itself, but in what form.
The Swiss Bankers Association (SBA) is closely monitoring this process. It recognises the significant potential of open banking and is therefore actively contributing to framework conditions that facilitate corresponding business models and thus increase the competitiveness of Switzerland’s financial centre.
At the same time, it must be ensured that if interfaces are opened to third parties, trust in the financial centre remains strong at all times.
For the SBA, it is key that the banks’ freedom of contract be unrestricted and that market participants have the ability to decide for themselves which third parties they wish to collaborate with. Regulatory measures such as the forced opening of interfaces are not expedient. Free competition and customer needs in particular should and will determine how open banking is implemented in Switzerland.
This is the only way that the Swiss financial centre will develop customer-orientated and non-government-ordered solutions in the area of open banking. Solutions that can also prevail in international competition.
The SBA defines open banking as a business model based on the standardised and secure exchange of data between the bank and reliable third-party providers or between different banks:
“Standardised”: The open standardisation of interfaces is a prerequisite for seamless third-party docking and error-free data exchange. The standardisation of interfaces should to the greatest extent possible be based on recognised market standards.
“Secure”: To ensure data confidentiality and security, technological safeguards are required.
“Reliable”: To ensure system integrity, it is necessary that only third parties who meet certain quality criteria – in particular the highest technical requirements – are granted access to the interface. This decision is made by the bank and its customers. The bank assumes responsibility, positions itself as a trustworthy partner and protects the interests of its customers. In doing so, every bank contributes to the security and stability of the Swiss financial centre and justifies why customers should continue to place a high level of trust in Swiss banks in the future.