What is open banking? Let’s find out

To put it very simply, open banking can be imagined as a digital bridge that connects various accounts and services. This “bridge” helps you manage your money in the easiest way possible, from your phone. It’s a revolutionary system when you think about it, it allows your bank to share privately and securely your information with other financial apps and institutions. Giving you more control and convenience, and offering an innovative way to handle your own finances.

Why is open banking useful?

Thanks to this system, financial institutions are able to share customer financial data in a safe and effective way through Application Programming Interfaces (APIs). APIs are used to share financial info such as transaction history, the balance of your account and payment data among banks, fintech companies, and other authorized third-party institutions or companies.

The use of APIs promotes greater transparency, and pushes competition and innovation in the financial industry, allowing customers to enjoy improved financial services.
In this article, we’ll explore what open banking is, who it serves, its advantages, its potential downsides, and how we leverage this technology at Beewise.

How does open banking work, and who is it for?

Open banking offers its benefits to a diverse range of individuals and stakeholders, from different groups of the “financial ecosystem”. The main group it’s aimed at is consumers and users who might be looking into the option of having more control and convenient tools when managing their finances. Open banking will empower you by allowing you to access a unified view of your accounts, make easy and fast payments, and discover personalised financial advice.

If you own a business you might want to look into it as well, as open banking streamlines cash flow management and will help you reduce costs while opening up financing opportunities. If you’re a fintech innovator, or would like to become one, open banking will enable you to develop new and cutting-edge financial products to cater to the specific needs of a customer. In short, open banking’s approach aims and includes a broad spectrum of people and enterprises. Whether you’re an investor, an innovator or an average banking user, open banking will transform how you interact and benefit from financial services.

How to access Beewise open banking?

How do we handle open banking? We decided to offer our users an easy-to-use app with an easy onboarding process. Thanks to Azimut’s long-standing investment experience, all you’ll have to do is putting your trust in us, no need to be a financial expert. You’ll be able to connect the Beewise app to most Italian banks, you can find the banks supported by our app at this link. During the onboarding process, all you’ll have to do is select your bank, fill the required info and give us consent to access the necessary information. That’s all! You will then be able to access your bank accounts and credit cards, and access our financial advice and analytics.

Visit our “How it works” and FAQs to get started.

What are the main benefits of open banking?

1. More financial control

Open banking allows you to take full control of your finances and to be able to have a comprehensive view of your accounts and all of your transactions in a single place. It’s easy, transparent and allows you to make better financial decisions.

2. Innovation

New actors on the financial scene, such as startups and younger companies, can develop innovative products and services to offer higher-value solutions to their consumers.

3. Convenience

Having everything in a single place will simplify your life, no need anymore to write down your passwords or open different apps and go through logins and authentication systems every time you need to check your bank account or make a payment.

4. Personalized financial advice

Once they have access to your financial data in detail, your chosen bank application can offer you personalised financial advice tailored to your needs. It’s a great tool you can use to make better-informed decisions and to learn how to better manage your money and your investments.

What are the risks of open banking?

1. Security issues

Sharing financial data and sensitive info via APIs might raise security concerns. Open banking is regulated and governed by very strict security standards, but the risk of data breaches or unauthorised access is always a possibility.

2. Privacy

Multiple parties are involved in open banking, your personal financial data will necessarily have to be moved around and privacy can be a point of concern. Trusting your open banking provider is a must.

3. Phishing

The more you spend time on the internet, and with more financial interactions occurring online, non-tech-savvy users may become targets of phishing attacks. Phishing is a kind of online fraud where hackers and other malicious actors try to trick users into revealing sensitive and private information online. Info such as login credentials and bank details can then be used and misused by these malicious actors for whichever reason.

Conclusion

The concept of open banking is transforming financial services as we know them and driving innovation back into the industry. As the world of fintech continues to evolve, we can expect open banking to take an increasing role in our daily operations, with apps like Beewise leading the way.