Open banking ready for business

A banking revolution starts today which aims to give people more control to make better decisions with their money.

Open banking is being launched following a probe by the Competition and Markets Authority (CMA), which found many banking customers are paying more than they should and are not benefiting from new services.

Under the initiative, people will be able to give companies other than their bank or building society permission to securely access their accounts.

The idea is that doing this should make it easier for people to compare products, based on their own needs, which could in turn shake up competition and encourage firms to up their game.

It will take some time for the full effects of open banking to be seen.

Imran Gulamhuseinwala, trustee of open banking, said: “It is difficult to overstate just how revolutionary open banking could, and should, be.

“New products will emerge from incumbents and entirely new entrants will join the market.

“New ways of managing money, of making life-changing financial decisions, of paying for things, will appear.”

Nine banks or building societies are initially taking part in open banking.

These are Barclays, Lloyds Banking Group, Santander, Danske, HSBC, RBS, Bank of Ireland, Nationwide and Allied Irish Bank.