CHICAGO, March 13, 2024 /PRNewswire/ -- The Open Banking Solutions Market will grow internationally in the future due to changing rules, more cooperation, and integration with cutting-edge technologies. In order to promote financial inclusion, prioritise security and trust, and concentrate on customer-centric solutions, broader use cases, and improved data analytics, it will push ongoing innovation in the financial services sector.
The Open Banking Solutions Market size is expected to grow from USD 5.5 billion in 2023 to USD 11.7 billion by 2028 at a Compound Annual Growth Rate (CAGR) of 16.0% during the forecast period, according to a new report by MarketsandMarkets™. Stringent regulations like PSD2 and CMA Order drive adoption of the market, innovations in APIs, data analytics, and cybersecurity, and Fintech companies offering agile solutions that disrupt traditional banking models are a few fundamental driving forces to leverage Open Banking solutions adoption across verticals and regions.
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250 - Tables
60 - Figures
210 - Pages
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Scope of the Report
Report Metrics |
Details |
Market size available for years |
2019-2028 |
Base year considered |
2022 |
Forecast period |
2023–2028 |
Forecast units |
Value (USD Billion) |
Segments Covered |
Offering, Solutions, Services, Application, Digital channel, Deployment Model, and End users |
Regions covered |
North America, Europe, Asia Pacific, Middle East & Africa, and Latin America |
Companies covered |
Plaid (US), Envestnet (US), MX technologies (US), Finicity (US), Tink (Sweden), Worldline (France), Trustly (Sweden), Axway software (US), Volt.io (UK), Temenos (Switzerland), Fabrick (Italy), Intuit (US), ndgit (Germany), Akana (US), Yapily (UK), Salt Edge (Canada), Token.io (Germany), Fiorano (US), TrueLayer (UK), Bud Financial (UK), OpenPayd (UK), Finastra (UK), Google (US), Sopra Banking software (France), BBVA (Spain) |
The managed services segment will record a higher CAGR by services during the forecast period.
Managed services play a vital role in the Open Banking Solutions Market by offering comprehensive support throughout the lifecycle of available banking platforms. Support and maintenance services ensure systems' continuous functionality and reliability, addressing technical issues and facilitating software updates. Concurrently, performance monitoring and optimization services track system performance, identify bottlenecks and optimize operational efficiency, enabling organizations to deliver seamless and responsive user experiences. Additionally, managed services assist in vendor selection and procurement, aiding organizations in choosing suitable technology partners and negotiating contracts. This involves evaluating vendors based on their capabilities, security protocols, and compliance with regulatory requirements. By leveraging managed services in open banking, businesses can streamline operations, enhance system performance, and make informed decisions in vendor selection, ultimately ensuring their open banking initiatives' sustained success and resilience.
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Based on the Application segment, Payment holds the largest Open Banking Solutions Market share during the forecast period.
Payment services are a cornerstone of open banking solutions, revolutionizing transactions and enhancing the overall customer experience. By leveraging open banking APIs, third-party providers (TPPs) gain secure access to customer accounts, enabling seamless payment initiation directly from bank accounts. This facilitates a wide range of payment options, including peer-to-peer transfers, bill payments, and online shopping, all executed with unprecedented speed and convenience. Furthermore, open banking fosters competition and innovation in the payment space as TPPs develop new and innovative payment solutions that cater to specific consumer needs and preferences. With real-time access to account data and enhanced security measures, open banking payment services offer consumers greater control, transparency, and confidence in their financial transactions. As a result, payment solutions within the open banking ecosystem drive efficiency, convenience, and trust, ultimately reshaping how individuals and businesses interact and transact in the digital economy.
By region, the Middle East & Africa region recorded the highest CAGR during the forecast period.
The Middle Eastern countries are rapidly adopting technological advancements and investing in knowledge-based economies. Saudi Arabia and the UAE are leading the way in adopting API management, leading to their development dominance. As Middle Eastern organizations focus on generating revenue and outsourcing to third-party managed service providers, adopting Open Banking solutions is accelerating in the region to reduce costs and save time.
The Middle East & Africa (MEA) region, the Open Banking Solutions Market is gradually emerging as a transformative force in the financial industry. While the adoption of open banking is still in its early stages compared to other regions, there is growing momentum driven by regulatory initiatives, technological advancements, and changing consumer behaviors. Regulatory bodies in several MEA countries are exploring frameworks to promote open banking to increase competition, improve financial transparency, and enhance customer choice. Fintech startups and traditional banks are beginning to collaborate to leverage open banking APIs and develop innovative financial products and services. Key focus areas include digital payments, peer-to-peer lending platforms, personal finance management tools, and digital identity solutions. As awareness and understanding of open banking grow in the MEA region, it is expected to catalyze further innovation, drive financial inclusion, and transform how people access and manage their finances.
Top Key Companies in Open Banking Solutions Market:
Some of the key players operating in the Open Banking Solutions Market are Plaid (US), Envestnet (US), Tink (Sweden), Finicity (US), Trustly (Sweden), MX Technologies (US), Worldline (France), Volt.io (UK), Temenos (UK), among others.
Recent Developments
- In February 2024, MX Technologies partnered with Trustly, intending to integrate MX's data enhancement services into Trustly's Open Banking product suite, thereby enriching the payment experiences of 8,300+ international merchants and their consumers who utilize Trustly's 'Pay with Bank' method. Using its proficiency in open finance APIs, Trustly will assist businesses in maximizing the potential of their financial data. Merchants can delve deeper into consumer behaviors by refining and categorizing transaction data, obtaining more accurate insights. This service empowers merchants to deliver personalized marketing promotions and loyalty programs, enriching the consumer journey and nurturing stronger bonds between merchants and their clientele.
- In January 2024, Risk Signals was launched by Tink, which conducts real-time risk checks during the payment process. Risk Signals provides a quick assessment of transactions in seconds while the payer progresses through the payment process, resulting in less disruption to the user experience. Risk Signals formulates a suite of demonstrated risk checks for each bank and market based on Tink's pan-European bank connectivity. Risk Signals' key features are live balances for real-time verification of a user's ability to pay, transaction history to assess fraud risk, and velocity checks to mark suspicious transaction activities.
- In October 2023, Plaid entered into a deal with Fiserv to enable secure and reliable data sharing through APIs while addressing growing consumer demand to access their financial information according to their suitable time, location, and manner. With this deal, consumers who bank with nearly 3,000 bank and credit union clients hosted by Fiserv will now have secure, credential-less API-based connectivity to more than 8,000 applications and services on the Plaid network via Fiserv's AllData Connect, allowing consumers to share their financial information with the third-party financial apps and services of their choice.
- In October 2023, Envestnet launched its embedded investment solution to provide a digitalized process for banks, credit unions, and financial advisors that will offer investing solutions within their (the banks, credit union entities) own apps and websites to customers within their existing banking experience. The service, consisting of diversified portfolios invested in exchange-traded funds (ETFs) and optional thematic stocks, enables financial institutions to retain deposits within their ecosystem and serve smaller account sizes digitally.
- In June 2023, Financial institutions and fintech firms can now exchange vital fraud intelligence across Plaid thanks to the launch of Beacon by Plaid, a cooperative anti-fraud network.
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Open Banking Solutions Market Advantages:
- Open banking solutions make it possible for financial data and services to be seamlessly integrated across a variety of platforms, giving clients a streamlined, individually designed banking experience.
- By allowing third-party developers to use open APIs (Application Programming Interfaces) to create creative financial products and services, open banking promotes a more competitive environment. Customers benefit from more options and value as a result.
- Open banking gives users access to a greater range of financial services and products, such as loan comparison tools, investing platforms, and budgeting applications, by allowing them to safely share their financial data with approved third parties.
- By combining financial data from several banks and financial organisations onto a single platform, open banking solutions make account aggregation easier and give users a comprehensive picture of their money.
- By enabling businesses to begin payments directly from consumers' bank accounts, open banking APIs reduce dependency on conventional payment methods like credit cards and checks and enable faster and more efficient payments and transactions.
- Through creative financial products and services, open banking solutions provide affordable substitutes for traditional banking services, enabling companies to optimise operations, save transaction costs, and enhance cash flow management.
- Financial institutions can access real-time financial data and insights through open banking systems, which improves risk assessment and management procedures for lending, investing, and compliance.
- By offering safe APIs for data sharing and transaction initiation, open banking solutions assist financial institutions in adhering to regulatory obligations such as the PSD2 (Revised Payment Services Directive) in Europe and other rules of a similar nature worldwide.
Report Objectives
- To define, describe, and forecast the Open Banking Solutions Market based on offering, application, digital channel, deployment model, end user, and region
- To offer comprehensive details regarding the primary variables impacting the market's growth (drivers, restraints, opportunities, and challenges)
- To determine the high-growth market sectors in order to assess the opportunities for stakeholders in the market
- To forecast the market size with respect to five main regions—North America, Europe, Asia Pacific, the Middle East & Africa, and Latin America
- To analyze the subsegments of the market with respect to individual growth trends, prospects, and contributions to the overall market
- To profile the key players of the market and comprehensively analyze their market size and core competencies
- To track and analyze the competitive developments, such as product enhancements, product launches, acquisitions, partnerships, and collaborations, in the Open Banking Solutions Market globally.
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