What is open banking?
Open banking lets customers securely share their banking data with approved outside companies through APIs. With the customer’s permission, a budgeting app or a lender can see account data directly, enabling services a single bank could not offer alone.
Customers share their banking data with approved outside companies through APIs.
A budgeting app or a lender sees account data only with the customer’s permission.
Smarter budgeting, faster lending decisions, payments that skip the card networks.
Their own data can work for them across services, not trapped in one institution.
For decades a bank’s data stayed locked inside that bank. Open banking pries it open, safely and with consent, so new tools can plug in: smarter budgeting, faster lending decisions, payments that skip the card networks.
Figure 1. Data moves only with consent
The customer’s permission opens the account data to an approved provider through a secure API, and new services flow back. From the definitions in this post; structure, not data.
It shifts power toward the customer, who can finally let their own data work for them across services rather than being trapped in one institution.
Before open banking
Locked in- A bank’s data stayed locked inside that bank
- The customer was trapped in one institution
- New tools could not plug in
With open banking
Shared with consent- Account data is shared with approved providers through APIs
- Only when the customer agrees
- The customer’s own data works for them across services
Sthenos builds the secure, API driven systems open banking depends on across financial services.
Is open banking safe?
It is built on consent and secure APIs. Data is only shared with approved providers, and only when the customer agrees.
Related services: PCI-compliant software development.
Related reading
Related terms: core banking system, digital onboarding, KYC.
