The hyper-competitive financial services market is continually evolving. Tweaks made to services today have the power to attract swathes of customers tomorrow.
Now new Open Banking initiatives and regulations are ushering in something of a banking renaissance. Driven by legislation out of Europe, Open Banking aims to force financial institutions to open up their proprietary hold over consumer’s accounts. This means customer spending insights will be available not just to traditional payment services but also telcos, retailers, utilities and more. Competition will be fierce.
To learn more about how Boomi can help you prepare for Open Banking, please download our “The Runner’s Guide to Open Banking.”
Opening Up Challenges and Opportunities
Of course, every revolution has its challenges. Many bank information technology (IT) departments are still new to the complex cloud services required to facilitate this kind of change. Indeed, many are still weighing the advantage of various approaches such as private cloud, public cloud or hybrid cloud.
Given that financial services is such a heavily regulated industry, any approach will need to adhere to strict security and privacy laws. Cloud platforms that minimize the need for custom coding, proprietary modules, and labyrinthine development projects will provide an advantage by making it easier to track and control data.
This marks the beginning of a whole new race. Commercial giants such as Amazon and Facebook, which already have banking licenses, will likely bring innovation and disruption to the existing competitive environment. Their agility in providing exceptional digital experiences could leave traditional banks —bogged down by technology from a different age — fall behind in the race.
In this hyper-competitive market, financial organizations will need to reinvent their brands. But open banking is a marathon, not a sprint. Today’s winners can fast become tomorrow’s losers if they don’t build on the right platform. Any company competing in this market will need a platform that makes it possible for them to rapidly integrate data, deliver innovative services and onboard new partners. That platform is Boomi.
APIs, Master Data Management and Open Banking
Boomi’s unified, low-code integration platform provides a host of benefits for financial services companies looking to compete in the new world of Open Banking.
Contactless smart cards and services like Apple Pay have revolutionized how customers make payments. Businesses are now able to ‘add-value,” both up to and beyond the moment of purchase. Boomi API Management enables businesses to collect transaction histories from accounts at multiple institutions, providing never-before-seen opportunities for innovation, including last-minute special offers based on buying history and payment reminders.
2. Seamless service integration
Customers demand seamless in-store experiences to match the services they receive online. Building a great experience is really important because customers can switch brands in a mobile minute. They will only stick with brands that deliver a fast, frictionless and effective service. Boomi API Management provides a single, scalable platform to manage all your APIs, making it possible for your organization to provide account holders with a speedy one-click experience.
3. Fees will be reduced
Fees and non-competitive exchange rates, once hidden from consumers, will become transparent. For some banks ready for a price war, this becomes an obvious choice for competitive differentiation. Some customers will switch based on cost, so an in-depth analysis of individual customer habits is critical. For this, you need complete and validated data, connected by APIs.
4. Stronger ID checks ‘both ways’
Open Banking means that more transactions than ever will be passing through multiple organizations. To account for this, financial services companies must pass increased workloads of sensitive data with absolute certainty. For this task, Boomi’s Master Data Hub helps ensure validated, consistent data across all your applications.
5. Intense International Competition
International ecommerce giants can exercise their advantages in scaling operations to generate massive data and deep consumer insights. They will use this advantage to cross-sell non-financial services and goods, likely reducing today’s profit margins for financial services. Being able to creatively partner — not just compete — with these new providers will be fundamental to success. Having open APIs will help your business easily connect with these institutions.
Boomi is the ideal technology to help you rise to the challenge of Open Banking and prepare for this new era of competition. It enables you to connect your mission-critical legacy applications with new cloud, fintech, mobile and social systems to drive transformation and agility in your business.
Meanwhile, a flexible integration layer lets you preserve core investments while embracing modern technology. In turn, you will be able to deliver a superior customer experience and build your connected business for the new future of Open Banking.
To learn more about how Boomi can help you prepare for Open Banking, please download our ebook, “The Runner’s Guide to Open Banking.”