What Is Open Banking? Here's Your Cheatsheet.

Open Banking is one of the wide-reaching package reforms being implemented by the Competition and marketing authority (CMA). This enables personal customers and small businesses to share their data securely with other banks and third parties, making it possible to compare products on the basis of their own requirements and to manage their accounts without having to use their bank.

How does it work?

Open banking will use Application Programming Interfaces (API) to share customer information securely. Third party providers will be able to use open banking APIs to see your transaction information to tell you what you might save when considering other service providers.

Why has it been introduced?

The ultimate aim of the PSDII is to break the banking monopoly on data in the hope of encouraging new entrants into the market with fresh product ideas and services. This scheme is being introduced to increase competition in the banking industry as a result of the older and larger banks not needing to “fight hard” for customers’ whereas smaller and newer banks who offer great new services find it difficult to grow. This increased competition will lead to customers lower fees and increased benefits to consumers.

When will it come into effect?

CMA have set the deadline for Open Banking to be implemented by January 2018 but the system will not be fully integrated until 2019. Many first mover banks launched their Beta in 2016. Institutions such as HSBC have released on their website that by early 2018 they will deliver new APIs that will allow personal customers and small businesses to share their data securely with other banks and trusted third parties. In the FinTech space, challenger banks like Monzo regularly mention Open Banking as a central part to their long-term strategy.


Make payments safer, increase consumer protection, foster innovation and competition while ensuring a level playing field for all players.

Current Big Bank Participants

Allied Irish Bank, Bank of Ireland, Barclays, Danske, HSBC, Lloyds Banking Group, Nationwide, RBS Group, Santander.


Help customers take control of their information without fear of being locked into a provider they will be able to move their data and deposits effortlessly wherever the best deals are offered.


Data can become a liability through potential misuse of customer data by third parties. Who does the customer blame, the bank or third party?

Fountain is a goal-based investment platform, and we're on a mission to democratize investment advice. To learn more about the future of investing and how Open Banking will play a role in our future growth, please join our beta community.