Open Banking :
What Does The Future Hold?
April 2017
Open Banking : What Does The Future Hold?
The evolution of Open Banking…
Open Banking is the shift
from closed to open
banking models.
Bank products, services,
functions and data
(including customer data)
are shared for use with 3rd
parties to add additional
value and create new
business models.
PAYMENT PROVIDERS
IOT DEVICES
CUSTOMERS
CUSTOMERS
UTILITIES
OPEN BANKING MOVEMENT
BANKING
INSTITUTION
AGGREGATORS
GOVERNMENT
BANKING
INSTITUTION
Customer, Client, Bank
Product Data
CLOSED ECOSYSTEM
LIMITED DATA ACCESS & SHARING
MONOLITHIC BUSINESS MODEL
SERVICE PARTNERS
TELECOMS
Customer, Client, Bank
Product Data
OPEN ECOSYSTEM
BI-DIRECTIONAL DATA ACCESS & SHARING
DISTRIBUTED BUSINESS MODEL
BANKS AS PLATFORMS
BANKING AS A SERVICE FABRIC
Open Banking : What Does The Future Hold?
Emerging forces shaping the future of FSI
REGULATION
CONNECTIVITY
UNBUNDLING OF
BANKING MODELS
CUSTOMER
EXPECTATIONS
COMPETITIVE
Open Banking : What Does The Future Hold?
Emerging forces shaping the future of FSI
REGULATION
The new EU directive requires Banks to provide third-party
access to customers accounts for both account information and
payment initiation via open APIs, starting 2018.
CONNECTIVITY
COMPETITION & MARKETS AUTHORITY (CMA)
UNBUNDLING OF
BANKING MODELS
CUSTOMER
EXPECTATIONS
PAYMENT SERVICES DIRECTIVE 2 (PSD2),
COMPETITIVE
Its report “Making banks work harder for you” published
9th August 2016 sets out a series of findings and measures
intended to help customers find and access better value
services and enable them to take control of their finances. This
will also enable new entrants and smaller providers to compete
on a level playing field.
PENSIONS DASHBOARD (ABI)
Pensions dashboards should let you see all of your pension pots
all together - in an online place that you can choose. The UK
Government’s objective is for the service to be available to
consumers by 2019.
Open Banking : What Does The Future Hold?
Emerging forces shaping the future of FSI
EMERGENCE OF NON-TRADITIONAL PLAYERS
REGULATION
CONNECTIVITY
UNBUNDLING OF
BANKING MODELS
CUSTOMER
EXPECTATIONS
The emergence of non-traditional players in the FS market,
largely from the FinTech community provides a threat to
existing revenue streams and loss of direct customer
relationship
EMERGENCE OF NEW SERVICE OFFERINGS
The ability to gain access to bank and customer data opens up
renewed opportunity for new service offerings which provide
additional value to customers, ranging from PFM solutions,
product comparison and fast-switching services, online lending
and cross-border payments solutions
COMPETITIVE
Open Banking : What Does The Future Hold?
Emerging forces shaping the future of FSI
HEIGHTENED EXPECTATIONS
REGULATION
CONNECTIVITY
UNBUNDLING OF
BANKING MODELS
MOBILE CONNECTIVITY
Fuelled by the always-on interconnected web and ubiquity of
mobile coverage, our favoured digital interactions are
increasingly mobile.
COMPETITIVE
CUSTOMER
EXPECTATIONS
Modern digital & social experiences are redefining the
use of technology in our everyday lives. Customers have
higher expectations on what their Banking service should
provide.
CONTEXTUAL SERVICE
Customers increasingly expect intelligent, contextual services
woven into their daily interactions. End-end services, not
products.
Open Banking : What Does The Future Hold?
Emerging forces shaping the future of FSI
Open API
CONNECTIVITY
REGULATION
UNBUNDLING OF
BANKING MODELS
CUSTOMER
EXPECTATIONS
By using APIs, organisations can rapidly assemble and launch
new digital products and services by leveraging both internal
and 3rd party APIs
APIs hide the complexity of underlying functions, allowing
business and technology partners to focus on building valueadded capabilities without being concerned with the internals.
Micro-Service Architectures
The emerging model of developing applications a suite of
independently deployable, small, modular services in which
each service runs as a unique process, is becoming standard
within the industry and further powering the API economy.
COMPETITIVE
Scalable Next-Gen Infrastructure
The proliferation of cloud infrastructure-as-a-service (IAAS) and
platform-as-a-service (PAAS) offerings in addition to new
offerings centred on rapid integration are further accelerating
the programmable web.
Open Banking : What Does The Future Hold?
Key Impending Questions
What will drive customers to maintain their relationship
with us vs. traditional and new competitors?
What capabilities will we own to generate
differentiation from traditional and new competitors?
How will we evolve our technical architecture to support our
changing role?
PRODUCT CHAMPION
Niche, specialist providers (including
Finch and neo-banks) offering finegrained services & products
Traditional incumbent banking model
with predominantly in-house products
and services offered through traditional
channels to distinct customer segments
SEGMENT OWNER
LOW
PLATFORM PLAYER
Transformative business model where
traditional Bank services are
augmented by a variety of offerings
through an ecosystem of providers
offering customers tailored and
context-sensitive services seamlessly
integrated into multiple touchpoints
Builder of market-leading capabilities
which are shared across multiple FIs
and intermediaries
UTILITY PROVIDER
LOW
HIGH
Banks appetite for open platform
transformation
OPEN BANKING
What will the the role of our bank in the unbundled, open
banking landscape?
HIGH
Customer acceptance and adoption of new
propositions and service providers
Combined, these forces will require a paradigm shift
by traditional financial institutions to redefine their
role in the financial services ecosystem
Open Banking : What Does The Future Hold?
Banking as a platform
Presentation Layer
Banks will need additional & enhanced architectural, technical and operational capabilities to support innovation driven by emerging open
banking concepts and challenger business models. This will include at a minimum API management capabilities integrated with the banks
existing integration tier and security architecture.
Channels
API Customer
Portal
Wearables
Mobile
Tablet
Internet
Kiosk
ATM
Teller
AISP
PISP
Partners
Customers
Things
Contact Centre
Business Layer
Integration Layer
Closed Interfaces
Routing
Protocol Handling
Orchestration
Message
Processing
Security
QOS
API Management
External Web APIs { }
Security
Digital Marketing
Performance
Monitoring
Illustration Engine
Account
Aggregation
Risk Profiling
Content
Management
Live Chat
Communication
Manager
Analytics
Master Data
Management
Auditing
Scanning & EIDV
Fraud Monitoring
Closed Interfaces
CRM
Communities
Wealth
Retail
Commercial
Payments
Logging
Common Services
Data Layer
Closed Interfaces
Customer
Wealth
Commercial
Transactional
Example Reference Architecture
Analytics
Product
Banking
Institution
Other
FS Institutions
API Ecosystem
“Open Banking & PSD2 are both a catalyst and
accelerator in this shift towards open services.
where maintaining flexibility and adaptability will be
critical.”
Open Banking : What Does The Future Hold?
API Economy will require new capabilities
A variety of additional capabilities will be required, some provided by API Management vendor products whilst others will fall to
organisations to architect and enable including delivery of underlying services, integration across all architectural layers and application of
security protocols in accordance with emerging standards.
API PLATFORM
CAPABILITIES
API Gateway
Exposing Bank APIs
Versioning
Throttling
API Support
Enrolment
OAuth / Open ID
API Management
Deployment
Rate Limiting
Training &
Documentation
Auditing
Fraud Protection
Service
Orchestration &
Aggregation
Caching
Monitising
3rd Party
Provisioning
Governance
Access Control
Routing
Publishing
Policy Enforcement
Analytics &
Reporting
Monitoring & Error
Handling
At Deloitte Digital we have established relationships with leading vendors in the API Management space (including Mulesoft, apigee, 3scale)
and open source stacks including Zool.
API Management Vendors
Open Banking : What Does The Future Hold?
Open Banking : What Does The Future Hold?
Moment
Moment Vision
Our vision of Banking Of
The Future, centred on
financial services with a
human touch
Brand Promise
Money is just a part of life. Make it a part you don’t
worry about.
What It Means
Little moments matter. And Money means different
things to different people. We’re always thinking ahead,
just like you. We use cutting-edge technology and a youcentred approach to solve as many little problems as we
can.
Open Banking : What Does The Future Hold?
Moment
Moment Vision
Moment Accelerator
Our vision of Banking Of
The Future, centred on
financial services with a
human touch
A reference architecture
and set of components
for building the bank of
the future, today
Be conversational
Be human
Only ever show what’s useful
Learn. Constantly.
Empathise. Always.
Always think ahead.
Open Banking : What Does The Future Hold?
Moment Accelerator Capabilities
We are building a series of accelerator components based on our Moment Reference Architecture to cover a range of capabilities,
including:
Account Aggregation
Categorising
Goal Setting
Actionable Insights
Conversational Assistant
View all of your accounts in one
place from multiple institutions.
Includes deposit, savings, credit,
loan, mortgage, ISA, pension
Track your spending by category.
Categorisation is applied
automatically according to
default rules, which can be
extended and customised by the
customer.
Manage your budget by setting
and tracking your goals, whether
saving for a holiday or planning
your retirement
Smart, actionable insights based
on your spending habits, financial
position and optimised for you
Engage with your Banking service
via an intelligent agent, whether
in-band within your mobile /
online experience or via your
preferred chat agent. Need help,
just ask!
Open Banking : What Does The Future Hold?
Open Banking : What Does The Future Hold?
Open Banking Readiness Approach
To help organisations get up and running with Open Banking and a response to the exploding API economy we have a range of
offerings which focus on both business strategy and proposition design through to technology implementation.
1
OPEN BANKING STRATEGY
STRATEGIC VISION & POSITIONING
MARKET ANALYSIS
VALUE-AT-RISK ASSESSMENT
STRATEGIC RESPONSE
3rd PARTY PARTNERSHIPS
FINTECH ENGAGEMENT
JOINT DEVELOPMENT / HACKATHONS
OPEN BANKING COMPLIANCE (UK)
SERVICE METRICS API DELIVERY
PRODUCT & REF DATA API DELIVERY
PROPOSITION ORIGINATION
BUSINESS TRACK
2
CUSTOMER RESEARCH
CUSTOMER NEEDS & HYPOTHESIS
OPPORTUNITY GENERATION
OPPORTUNITY DEEPENING
CUSTOMER TESTING
RAPID PROTOTYPING
DEFINE API REFERENCE
ARCHITECTURE
BUILD / DEPLOY
API INTEGRATION PLATFORM
3
INTEGRATION & API
PLATFORM SCAFFOLDING
(CORE FOUNDATIONS)
PLATFORM ARCHITECTURE
SECURITY ARCHITECTURE
INTEGRATION PATTERNS
API MANAGEMENT SUITE
IMPLEMENT API FRAMEWORK
DEFINE 3RD PARTY ENROLMENT PROCESS
BUILD DEVELOPER PORTAL
PROVISION EXAMPLE APIS / TEST DATA
DEPLOY & LAUNCH PLATFORM
OPEN ENROLMENT PROCESS
4
OPEN BANKING DELIVERY
API DESIGN
API POLICY DESIGN
API GOVERNANCE
API BUILD
API POLICY DEFINITION
API INTEGRATION
API POLICY CONFIGURATION
API DEPLOYMENT
TECHNOLOGY TRACK
PROPOSITION DEVELOPMENT
ALPHA TESTING
OPPORTUNITY REFINEMENT
BETA TESTING
DEPLOY & LAUNCH
SANDBOX
RUN
PLATFORM
RUN PLATFORM
MONITOR & TUNE SERVICE
EVALUATE AGAINST SERVICE KPIS
RBS OPEN PFM DISCUSSION
Thank you