BANKING ECOSYSTEMS
“THE FUNDAMENTAL CHALLENGE WILL BE WHETHER A BANK ’ S IN-HOUSE TECHNOLOGY CAN SUPPORT THE DEVELOPMENT OF A DIGITAL PLATFORM ”
JAMES ALLUM SVP FOR EUROPE , PAYONEER
While open banking may have forced the issue for reluctant banks to foster financial ecosystems , particularly those with extensive data pools that may be timeconsuming or costly to integrate into a financial ecosystem , the question remains : why are some banks reluctant to foster or join financial ecosystems ?
THE FEAR OF LOSING CONTROL For Fernando , the slow adoption rate of financial ecosystems at legacy banks comes down to a shift in mindset , one which many
institutions struggle to adopt , having historically built walls around customers ’ finances and data .
“ Banks have jealously guarded their customer data against any external sources ,” says Fernando . “ With the introduction of open ecosystems , banks face a new challenge : opening their data to third parties while ensuring customer consent . This concept was counterintuitive and initially intimidating for banks . The idea of sharing customer data with external entities went against the long-standing approach of protecting data within their fortified systems .”
It seems , then , the slow uptake of open ecosystems at legacy institutions is as much a philosophical issue as it is a practical one , with the need to embrace openness and
fintechmagazine . com 51