Voice of the Industry

The revolution of Open Banking and the new opportunities for banks

Friday 16 November 2018 08:10 CET | Voice of the industry

Mathieu Barthélémy, Product Manager of the Digital Banking Platform, Worldline: ‘Open Banking is not only a matter of regulatory compliance; it is a way to unleash the value of data’

Faced with the transformation of the regulatory and competitive landscape, a broad change in the retail banking industry is taking place and new financial services are emerging. Like other industrial sectors, such as telecom, retail or public transportation, the historical services of banks are gradually being relegated to the convenience stage, forcing the banking industry to reinvent its businesses beyond simple financial services.

The entry into force of the PSD2 on January 2018 encouraged financial institutions to create new products and business models. There are plenty of ways to exploit the opportunities of Open Banking, whether the bank’s strategy is reactive (with the exposure of regulated APIs), defensive (aimed at generating new revenues through the monetisation of proprietary APIs), or offensive (with the creation of new financial and non-financial services).

Although complying with PSD2 requires a massive effort from banks, with strict security requirements for electronic payments and data processing, it also offers them the opportunity to move into a whole new central position in future financial and non-financial services.

In fact, Open Banking is not only a matter of regulatory compliance; it is a way to unleash the value of data – in this case, but not only, banking and payment data – and it has the potential to create a new type of economic model for banks as well as for other parties playing a role in the payments landscape.

In this context, banks can position solely on providing account access to third parties or choose to make the most of this opportunity by developing themselves new applications to compete directly with these new third party players. For example, they could add new offerings to their portfolios, such as digital identity services, API-based lending or risk management solutions.

Under certain conditions, PSD2 forces banks to share data and services that were previously reserved for their exclusive use. However, this constraint actually paves the way for innovation in the banking industry, while investing in customer relationship and user journey.

What is more, Worldline believes that PSD2 has the potential to stimulate the adoption of Open APIs in the European market and to give rise to new business models – therefore strengthening competition. Opening access to bank accounts could lead to an explosion of new innovative services; banks can benefit from this dynamic environment by positioning themselves in a timely and proactive manner and taking full advantage of Open Banking supported by Worldline’s solutions.

Mastering the digital transformation that this new context brings, while facing all opportunities and related risks, is the key for success and Worldline understands this prowess.

With more than 45 years of experience in securing electronic transactions in the payment ecosystem, Worldline supports businesses to address their PSD2 challenges, as well as their need for innovation through its Digital Banking Platform, acting not only as a technical service provider, but also as a trusted strategic advisor.

The platform, winner in the API category of the PayFORUM 2018, provides a large and flexible range of services that enables customers to maintain competitiveness by facing 3 main challenges:

innovate faster while reducing costs to enrich existing services;

partner with the best fintechs to renew customer interest;

generate new revenue streams.

Digital Banking Platform services structure

Beyond basic compliance, Worldline’s goal is to support financial institutions in their Open Banking strategy by providing an extensible platform to innovate faster while reducing costs and create new use cases in an omnichannel approach (like new customer onboarding, personal finance management, loan subscription, financial assistant, among others).

The flexible and modular WL Digital Banking Platform provides the back-end that supports fast channel development. As a service layer, composed of a collection of business enablers, the digital platform allows simple data coming from the bank information system or third-party to be processed, valued, and properly displayed on mobile or web applications.

Each of the solutions provided by the platform can be deployed as standalone or combined with others to suit the specific business type, strategy and goals of the customer.

Some of the many services include:

daily banking: consultation of accounts and loan/insurance contracts, transfers (e.g. SEPA, including instant payment), P2P payments, secure messaging;

self-service banking: modification of card limits, mobile wallet, alerting, subscription to online products, trade order management & stock data;

security: Strong Client Authentication, Risk Based Authentication, fraud and litigation.

New revenue streams will evolve, and TPPs – being banks, telcos, retailers, insurers, or any other type of company – can benefit from this dynamic environment – if they position themselves in a timely and proactive manner. The API economy is proving to us, more than ever, that choosing the good strategic partner is crucial.

For this reason, Worldline and equensWorldline, its subsidiary of payment services leader in Europe, propose a comprehensive suite of services and solutions to reduce and manage any of the Open Banking complexities.

About Mathieu Barthélémy

Mathieu has been working at Worldline in Digital Banking teams for more than 10 years. He started as a software engineer before spending a number of years as a team leader in Mobile Banking Apps. Currently, Mathieu is the Product Manager of the WL Digital Banking Platform, the solution designed to support Worldline’s customers in their Open Banking strategy.


About Worldline

Worldline is the European leader in the payments and transactional services industry. With nearly 45 years of experience, we are a highly innovative pan-European company with global reach, providing secure payments and transactional services covering the entire payments value chain. Our next-generation, omnichannel, end-to-end solutions provide seamless transactions for Merchant Services, Financial Services and Mobility & e-Transactional Services.

About equensWorldline

equensWorldline is the pan-European leader in payment services. Being part of the Worldline Group, we combine long-standing proven expertise in traditional mass payment systems (issuing, acquiring, intra- and interbank payment processing) and innovative ecommerce and mobile payment solutions.

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Keywords: Mathieu Barthélémy, Worldline, equensWorldline, Open Banking, banks, APIs, PSD2, digital banking platform, digital identity, mobile wallet, SEPA, P2P payments, TPPs
Countries: World

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