Tink’s study shows a rise in open banking investments in Europe

Source: IBS Intelligence 2020-05-29

Stockholm-based Tink has released new research that shows a rise in spending by European financial executives as they are investing more in Open Banking. The investments aim to enhance customer experience and generate new revenue streams. The data revealed that median open banking investment budgets for European financial institutions are typically between €50-€100 million, with spending exceeding €100 million for 45% of financial institutions surveyed.

63% have said that open banking budgets have grown since last year, with annual spending rising by 20%-29. 10% of the institutions surveyed showed a decline in their investments in this area.

Daniel Kjellén, co-founder and CEO, Tink, said, “The size of these investments prove that open banking has moved firmly from compliance challenge to commercial opportunity in the minds of financial institutions. Not only has it become integral to the digital transformation of financial institutions and been embedded across all parts of the organisation — it has also emerged as a key driver of revenue growth and an important differentiator when it comes to customer engagement and experience.”

44% of the respondents believe that open banking investment will lead to an improvement in customer experience, 39% said that it would bring IT modernisation while 34% stated that process optimisation will be the result. 33% of respondents considered legacy IT seen as the top inhibitor of investment, while, 32% cited more important business priorities as a blocker and 31% believed regulatory restrictions stifled spending.

“Today, as we wrestle with the new social and economic realities of life with Covid-19, it is vital that financial institutions continue to prioritise the development of innovative open banking use cases that support their customers in new ways and provide financial services seamlessly over digital channels,” the CEO concluded.

Tink’s research also showed that 44% of respondents consider revenue growth from new customers as the most important success metric for open banking investments. This is followed by revenue growth from new products and services (39%) and the monetisation of data by offering developer services or APIs (37%).

bank

Europe

Compliance

finance industry

Tink’s study shows a rise in open banking investments in Europe

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