Accenture Banking Blog

In my first post, I talked about how it was time for banks to start looking beyond compliance in Open Banking and to imagine their role in the new application programming interface (API) economy.

Open Banking offers banks the opportunity for greater efficiencies and new revenue growth, not to mention competitive advantages in an increasingly disrupted financial services landscape.

As banks chart their Open Banking journeys, we see the emergence of two Open-Banking-powered business models:

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Banking as a platform

In this model, the bank is a net consumer of partner APIs—aggregating its traditional services with digital and new services from third-party partners. This model is suitable for banks that want to rapidly offer new services or expand in a new market in cooperation with ecosystem partners. It would work well for both established banks with a large customer base and a strong digital channel footprint, as well as new challenger banks looking to capture market share rapidly. It enables banks to expand their offerings beyond financial services.

The benefits for banks include: the creation of revenue streams by cross- and up-selling of the new services and products and reduced costs for developing new offerings.

The benefits for third parties include: a wider distribution network, access to the bank’s existing customer base and the ability to bundle services with the bank’s products.

Banking as a service

The bank is a net producer of APIs in this model. It allows banks to use APIs to distribute core financial services products such as payments, loans and mortgages. It would best serve banks that have an efficient product manufacturing ability, strong operational processes and robust back-end capabilities. It is particularly popular within payments, credit products, treasury and transaction banking segments.

The benefits for banks include: rapid expansion of distribution channels and market reach via access to new customers, and reduced operating and marketing costs for products and services.

The benefits for third parties include: revenue generation and helping attract new customers for tailored offerings.

Both models offer customers a wider range of products, improved experiences, frictionless banking journeys and customized services.

Those who are not building business models powered by Open Banking today risk falling behind as APIs continue to emerge as a new revenue opportunity and competitive advantage in financial services.

Next time, I’ll share the monetization options for each Open-Banking-powered business model. In the meantime, I invite you to read our report, Power Plays for Monetizing Open Banking APIs.