Banks Moving to Improve Consumer Data Sharing
Banks are actively responding to consumer demand for convenient, high quality banking services by making it more appealing for consumers to share their personal information. A recent article in American Banker discusses announcements by Spanish banking group BBVA and Bank of America of new efforts to provide rich supplies of customer data to third party developers and others.
BBVA announced the launch of its open banking program to make eight of its application programming interfaces (APIs) available to developers, who would in turn create new value added services. The new services are expected to provide enhanced customer experiences by improving conversion, onboarding processes, payment management, identity verification, and consumer analytics, among other things. The new applications based on these APIs are only granted access to personal consumer information if the customer expressly accepts the service’s activation, thereby letting the consumer control with whom they want to share their data. The open APIs strategy is a key element of BBVA’s efforts to become an innovation engine for other companies to develop uses which never would have occurred to the bank acting alone. The program is currently available in Spain, with rollout in the U.S. coming later this year, followed by additional country rollouts.
Also recently, Bank of America announced it is piloting with multiple financial data aggregators to provide its customers with the ability to simply and securely connect data from their accounts to third-party financial management applications. Customers will be able to choose and control with whom they are sharing their data. Customers would no longer need to share usernames and passwords with the third parties, in an environment that provides a seamless interaction and improves security. Data sharing through open banking appears poised for rapid growth.