Open banking has entered a “new phase” after the Competition and Markets Authority (CMA) determined that the six largest banks in the UK have implemented the requirements of the open banking roadmap.
The open banking trustee advised the CMA on Monday that Barclays, HSBC, Lloyds, Nationwide, NatWest and Santander had implemented the remaining roadmap items.
Following the advise, the CMA ruled the roadmap to be “substantially complete”.
Open banking provides third-party financial service providers access to consumer data held by banks and non-bank financial institutions through the use of application programming interfaces. It was introduced by the CMA in 2018 to free up data sharing between traditional banks and smaller startups, and now has over 6 million users in the UK.
Today’s update is an “important milestone”, Sarah Cardell, Chief Executive of the CMA said, and moves open banking into “a new phase”.
Although the six major banks have implemented the roadmap, there are further obligations they must fulfil.
Three other smaller banks – Allied Irish Bank, Bank of Ireland and Danske Bank – still have to implement items from the roadmap. The CMA expects these banks to complete shortly and “will take enforcement action if necessary and appropriate to ensure this happens in a timely way”.
The update comes shortly after a number of fintech firms wrote a letter to the Financial Conduct Authority criticising the slow progress made on open banking. The letter claimed the “integrity and potential” of open banking was under threat.
17 firms and industry body Coadec said that while the UK’s progress on the topic was once “the envy of the the world”, its future was now “uncertain” due to a lack of direction from the body in charge of its roll-out, the Joint Regulation Oversight Committee (JROC).
“We call for the JROC to publish clear directions and timelines for the continued enforcement of Open Banking in 2023 and beyond as a matter of urgency,” they added.