Why OCBC Group VP believes open banking can enhance CX
While not all banks are ready to open up their APIs and their ecosystems, regulators are aggressively pushing for it and industry analysts believe it’s a good thing for the industry in the long-run.
“Success in the digital era will be in generating new value from business platforms and partner ecosystems whether it is called Open Banking or not. The unbundling and re-bundling of the value chain of financial services present an opportunity to truly remake the business of banking,” explained Ainger’s colleague IDC Financial Insights AVP Michael Araneta.
To be fair, most banks see the big picture for the industry but don’t really understand how open banking and APIs can help them better serve their customers.
In an exclusive interview with Tech Wire Asia ahead of the ConnecTechAsia Summit in Singapore in June, OCBC Group VP (Open Banking / API Business) Dilip Krishnan explains why the industry needs open banking and APIs and how it can help transform the customer experience (CX) banks provide.
Krishnan believes open banking allows the industry to better understand the customer, provide a frictionless customer journey, and help customers make ‘segmented, split second, everyday decisions’ amongst the clutter of other mature products and experiences through APIs.
“Open banking has visibly blurred the lines between traditional financial products or at least forced the FIs to reimagine their offerings by better understanding the customer through aggregated information.”
OCBC’s Krishnan emphasizes that banks should see open banking as a way to enhance customer convenience by encouraging healthy competition and innovation through interoperability [with fintech and other players entering the tightly regulated financial services industry].
IDC Financial Insights Senior Research Manager Anuj Agrawal, in a recent interview with Tech Wire Asia, had explained that as a result of open banking, collaborations will flourish to really help customers.
“Quickbooks, for example, can access and import transaction data for customers, making book-keeping simpler for clients in regions where open-banking allows for this,” Agrawal explained.
Although a simple example plucked from the daily workflow of the everyday accountant, Agrawal’s example showcases the power of open banking and what it can really do for customers and partners.
Of course, banks that are able to support such collaborations and integrations will be more favorably looked at by customers.
A collection of such integrations could be reason enough for the bank to suddenly become more attractive to a group of customers in the market, proving to be a strong competitive edge in the short and medium term.
“With third-party ecosystem collaborations to compete effectively, open banking is poised to expand the market size through the introduction of personalized offerings on the right channels and with affordable pricing,” concluded OCBC’s Krishnan.
Thanks to open banking, tomorrow’s financial services landscape will provide more opportunities to bankers and everyone else in the ecosystem providing customers with a better CX overall.