and Open Finance
Open banking resp. open finance will change and have a lasting impact on the banking industry. The Swiss Bankers Association recognises the significant potential of open banking for the financial centre. It considers market-based solutions as key to maintaining the trust of customers.
Potential for all market participants
Changing customer needs, new stakeholders and innovative technologies are posing challenges for traditional banks. In light of the increasingly fragmented value chain, where customers are being served by a large number of different financial services providers such as banks, fintech companies and service providers from other industries, it is no longer a question of whether open banking resp. open finance will establish itself, but in what form.
The Swiss Bankers Association is closely monitoring this process. It recognises the significant potential of open banking resp. open finance for all market participants and is therefore actively contributing to the establishment of framework conditions that facilitate business models based on open banking and thus increase the competitiveness of Switzerland’s financial centre.
Trust especially important
The Swiss Bankers Association recognises the opportunities that arise from opening interfaces and collaborating with third parties. However, it is key that this opening be not just one-sided. The mutual exchange of data provides added value to all stakeholders, namely customers, third-party providers and banks.
The opening of interfaces and the increased exchange of data also give rise to new challenges. Especially in the area of data protection and cybersecurity. For Swiss banks, the protection of customer data is fundamental. The exchange of data must therefore take place at the highest technical level, which must be ensured not only by the banks involved, but also by the third-party providers.
The Swiss Bankers Association 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.
Common understanding of roles
The SBA and Swiss Fintech Innovations (SFTI) have worked with all the relevant financial centre stakeholders to agree on the roles each will play in future cooperation on open finance, particularly in terms of API standardisation. SFTI is acting as a central forum, drawing up the necessary business and technical principles and recommendations for open finance in Switzerland in conjunction with the leading national and international stakeholder groups and partner organisations. Its working group is broad-based, bringing together representatives of banks and insurers as well as fintech and technology firms. The SBA, for its part, is assuming a coordinating role in conveying the industry’s concerns to politicians, authorities and the general public, which it can do in a targeted and effective manner thanks to the clear allocation of roles.
Position of the Swiss Bankers Associations