Research from Equifax has revealed that 90% of UK consumers have not heard of the Open Banking initiative, with 45% of respondents then going on to say that they are not likely to use Open Banking when it becomes available.
When asked about sharing personal data through Open Banking, 60% said they would not consent to this. Consumers’ concerns about data being shared included security (67%), and that third parties would be able to contact them (62%).
25-34 year olds are most accepting of the scheme, with 41% stating they are likely to use Open Banking (compared to 27% nationally). In this age group, 35% are also likely to consent to their personal data being shared (compared to 24% nationally).
The research found a lack of understanding when it comes to declaring information, with 43% stating they were not aware that the data they share with banks (e.g. if they have a mortgage or require a loan) can have a direct impact on the products that banks offer to them.
Respondents of the survey do however recognise the positives of Open Banking and would find the following tools important if they were made available through the initiative:
- The ability to better monitor across their bank accounts to help protect against fraud (64%)
- The ability to compare current accounts offerings from different banks (53%)
- The ability to better monitor their spending or debt and see accounts all in one place (51%)
- The ability to access lenders offering better terms for financial products (50%)
“The implementation of Open Banking is quickly progressing and the start of this year will see personal customer transaction data available on a read-only basis. There is not much time till the Open Banking Standard’s full scope, including business, customer and transactional data is complete,” says Jake Ranson, Banking & Financial Institutions Director at Equifax UK.
“It’s concerning that such a high number of the population are unaware of Open Banking, something the industry needs to remedy for all parties to reap the full benefits. Not only will the initiative transform the customer banking experience by enabling consumers to compare and save on current accounts, it will also help them look for mortgages more easily and access better terms for loans.
“More needs to be done to educate customers of how they can personally gain from Open Banking. By working with customers to help them better understand how it works, banks can help their customers realise the advantages, especially when searching for the most suitable financial products for their individual needs.”