Concerns Over Britain’s Stalled Progress in Open Banking

Britain’s Financial Conduct Authority (FCA) Chief Executive Officer, Nikhil Rathi, has expressed concerns about the potential squandering of the country’s early lead in opening up banking data. In prepared remarks for a speech on Tuesday, Rathi warned that the failure to make data sets more readily available to smaller players could impede growth, innovation, competition, and international competitiveness.

Open banking, introduced by British regulators in 2017, enables lenders to share specific customer data with other financial firms. This initiative aimed to foster competition in the financial services sector, particularly as a response to a study revealing that major retail banks were not pushing hard enough to innovate. Millions of British customers have since benefited from the changes, allowing them to access a broader range of services.

While the UK was an early adopter of open banking, Rathi noted that progress has slowed. He emphasised the importance of continuing to make data sets available to smaller players, ensuring that growth, innovation, and competition in the financial sector do not stall. The success of open banking in the UK has prompted other countries, including Brazil and India, to race to catch up with developments in the UK and Europe.