Open Banking, what is it?
Discussion
It's opening up your banking details so that you can be more effectively marketed to while removing some of the protection that you currently have. The oft-vaunted example is that you could sign up to an aggregation portal & manage all of your accounts from there, or the portal can do it for you.
The issue is you have to give them access to your bank account & permission to make transactions. However, read your bank's T&Cs closely & you may find them refusing to accept liabilty if anything goes wrong because you've disclosed your banking details to a third party. The aggregators point out that nothing will ever go wrong because they work to the same security rules as your bank; believe that at your peril because no-one has ever been scammed have they?
Of course all your juicy financial information will mean they can target you with offers when your house insurance comes up for renewal, the same way these nonsense credit score firms do. The credit score is b
ks, but they can target you with all sorts of offers as they you've given them a treasure trove of personal information.
The issue is you have to give them access to your bank account & permission to make transactions. However, read your bank's T&Cs closely & you may find them refusing to accept liabilty if anything goes wrong because you've disclosed your banking details to a third party. The aggregators point out that nothing will ever go wrong because they work to the same security rules as your bank; believe that at your peril because no-one has ever been scammed have they?
Of course all your juicy financial information will mean they can target you with offers when your house insurance comes up for renewal, the same way these nonsense credit score firms do. The credit score is b
ks, but they can target you with all sorts of offers as they you've given them a treasure trove of personal information.In principle, it's a great idea. At a basic level, your bank is being forced to open up access to your account details such that third parties can provide portals that will allow you to manage all your accounts in one place, regardless of which bank they are with. Whereas at the moment, you will probably have several different apps on your phone, one for each bank, with Open Banking you will have a single app that has all of your accounts in it. The idea is also that these aggregators will be able to look over alternative accounts and suggest ones with better interest, better extras, lower fees etc. and manage the switchover for you if you want to change. Ultimately you might not even know which bank you are with as you are just consuming a service through somebody else's portal.
The reality is currently less great and most of the banks are paying only slightly more than lip service, and these third-party portal apps aren't where they should be.
Your bank doesn't really want to do it as it's lots of work for them, and the main idea is to increase competition and encourage people to shop around. But they are compelled to support Open Banking by statute and that includes making you aware of it.
tl;dr : it's fundamentally a good idea but very much in its infancy, and your bank has a vested interest in making it go badly/slowly.
The reality is currently less great and most of the banks are paying only slightly more than lip service, and these third-party portal apps aren't where they should be.
Your bank doesn't really want to do it as it's lots of work for them, and the main idea is to increase competition and encourage people to shop around. But they are compelled to support Open Banking by statute and that includes making you aware of it.
tl;dr : it's fundamentally a good idea but very much in its infancy, and your bank has a vested interest in making it go badly/slowly.
Mr Pointy said:
However, read your bank's T&Cs closely & you may find them refusing to accept liabilty if anything goes wrong because you've disclosed your banking details to a third party.
Pretty sure this is wrong. You are thinking of the old way whereby aggregators used web scrapers to access your bank accounts and you had to give them your username and password. That's where the banks won't accept liability.Open Banking works differently, you don't have to supply your username/password. You basically tell the third party to request access, then you can approve/deny the access via your online banking and revoke it at any point.
XJ75 said:
Mr Pointy said:
However, read your bank's T&Cs closely & you may find them refusing to accept liabilty if anything goes wrong because you've disclosed your banking details to a third party.
Pretty sure this is wrong. You are thinking of the old way whereby aggregators used web scrapers to access your bank accounts and you had to give them your username and password. That's where the banks won't accept liability.Open Banking works differently, you don't have to supply your username/password. You basically tell the third party to request access, then you can approve/deny the access via your online banking and revoke it at any point.
markiii said:
one hack opens access to all your accounts.
happy to keep mine separate and spread the risk
me too ...sounds like another way for us to give away privacy and security in the name of convenience......what next, shall we let Alexa manage our bank for us so we dont actually have to log in ?happy to keep mine separate and spread the risk
bogie said:
me too ...sounds like another way for us to give away privacy and security in the name of convenience......what next, shall we let Alexa manage our bank for us so we dont actually have to log in ?
You think you're laughing, but I have had exactly that conversation with pretty much all of the major UK banks in the last 12 months.ETA: presuming that it can all be done in a secure manner and that, for example, identification by device & voice print is at least as reliable as say device & fingerprint is now, I can't be the only one that thinks "Alexa, what is my current account balance" and "Alexa, transfer a hundred quid to James's bank account" would be a great thing to be able to do.
Edited by deckster on Friday 26th July 13:03
Mr Pointy said:
hen I got the first information about Open Banking from Barclays I read it pretty carefully & it certainly seemed they would assist if there were any issues with an aggregation site but they weren't promising to cover any losses. If that's changed, then fine.
Aggregation sites should only have read only access anyway, so in theory there's no chance of any losses. It's possible to initiate transactions via Open Banking but an aggregation site wouldn't have permissions to do that.deckster said:
You think you're laughing, but I have had exactly that conversation with pretty much all of the major UK banks in the last 12 months.
ETA: presuming that it can all be done in a secure manner and that, for example, identification by device & voice print is at least as reliable as say device & fingerprint is now, I can't be the only one that thinks "Alexa, what is my current account balance" and "Alexa, transfer a hundred quid to James's bank account" would be a great thing to be able to do.
Does everyone that uses Alexa lack fingers? I really don’t see the attraction of this technology. ETA: presuming that it can all be done in a secure manner and that, for example, identification by device & voice print is at least as reliable as say device & fingerprint is now, I can't be the only one that thinks "Alexa, what is my current account balance" and "Alexa, transfer a hundred quid to James's bank account" would be a great thing to be able to do.
Edited by deckster on Friday 26th July 13:03
deckster said:
You think you're laughing, but I have had exactly that conversation with pretty much all of the major UK banks in the last 12 months.
ETA: presuming that it can all be done in a secure manner and that, for example, identification by device & voice print is at least as reliable as say device & fingerprint is now, I can't be the only one that thinks "Alexa, what is my current account balance" and "Alexa, transfer a hundred quid to James's bank account" would be a great thing to be able to do.
Based on how crap voice activated calling is, mine would send that £100 to Jane.ETA: presuming that it can all be done in a secure manner and that, for example, identification by device & voice print is at least as reliable as say device & fingerprint is now, I can't be the only one that thinks "Alexa, what is my current account balance" and "Alexa, transfer a hundred quid to James's bank account" would be a great thing to be able to do.
NickCQ said:
deckster said:
You think you're laughing, but I have had exactly that conversation with pretty much all of the major UK banks in the last 12 months.
ETA: presuming that it can all be done in a secure manner and that, for example, identification by device & voice print is at least as reliable as say device & fingerprint is now, I can't be the only one that thinks "Alexa, what is my current account balance" and "Alexa, transfer a hundred quid to James's bank account" would be a great thing to be able to do.
Does everyone that uses Alexa lack fingers? I really don’t see the attraction of this technology. ETA: presuming that it can all be done in a secure manner and that, for example, identification by device & voice print is at least as reliable as say device & fingerprint is now, I can't be the only one that thinks "Alexa, what is my current account balance" and "Alexa, transfer a hundred quid to James's bank account" would be a great thing to be able to do.
Sheepshanks said:
Based on how crap voice activated calling is, mine would send that £100 to Jane.
Have to say I agree with these sentiments. A solution looking for a problem! Mind you, I still have a 'normal' heating time/thermostat because I am distrustful of the Hive/Nest style things. Moderately Luddite, I know....
Sure, I imagine there are some folk who could benefit....maybe blind/partially sighted/internet-phobes, but someone would need to set it all up, & IMHO, the security implications are staggering for potential screw-ups.
I prefer to keep control, have separate online things with separate passwords.....
This sheds a tiny bit of light https://www.adviserpointsofview.com/2019/07/psd2-r...
To my simple mind, it's a misguided initiative. Perhaps we need just a couple of scare stories re. challenger bank solvency for it to wither away - thought I'd read that Metro Bank had low reserve levels. Just look at the unfolding disaster of so many cheap energy suppliers folding......
My solution would be somehow to ban the common practice of "treating existing customers unfairly" by offering better rates to new accounts. I have absolutely no desire to change my current account after 40+ years. But it's a real faff to have to trawl around seeking better rates for 4-5 savings accounts each year when the headline interest rate drops to 0.1%! I know it's only 5 mins to set up a new account but then there's the hassle of setting new pw's, making gradual daily transfers, collating tax statements etc etc. Nationwide used to reward loyalty but their rate is pretty miserable now.
To my simple mind, it's a misguided initiative. Perhaps we need just a couple of scare stories re. challenger bank solvency for it to wither away - thought I'd read that Metro Bank had low reserve levels. Just look at the unfolding disaster of so many cheap energy suppliers folding......
My solution would be somehow to ban the common practice of "treating existing customers unfairly" by offering better rates to new accounts. I have absolutely no desire to change my current account after 40+ years. But it's a real faff to have to trawl around seeking better rates for 4-5 savings accounts each year when the headline interest rate drops to 0.1%! I know it's only 5 mins to set up a new account but then there's the hassle of setting new pw's, making gradual daily transfers, collating tax statements etc etc. Nationwide used to reward loyalty but their rate is pretty miserable now.
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