Voice of the Industry

The underdogs of Open Banking

Friday 3 December 2021 08:40 CET | Editor: Oana Ifrim | Voice of the industry

Vlad Macovei, content editor at The Paypers, shares key insights on the state of Open Banking across the globe 

The article was originally published in The Paypers` Open Banking Report 2021.

Open Banking is a hot topic in any financial system across the world. Since PSD2 came around in 2015, banks had to take notice of the third-party providers’ army while the latter began to be fueled by innovation and healthy competition. With each year that passed, we saw the term Open Banking spread out like wildfire across the financial industry, each continent giving in its spin, depending mostly on various cultural backgrounds.

An idealisation of uniting financial services with open access to financial data, all for the benefit of the customer ignited the minds of financial pundits. Banks used to traditional, antiquated systems had to adapt or succumb to facing unmatched competition. In the age of the internet, technology did the unavoidable, it made its way to financial services.

Although you can find immense quantities of information regarding how Open Banking thrives in the UK and Europe, how fintech in the US is booming, or how digital banking is storming Southeast Asia, we deemed worthy to shed some light on some unsung heroes as well, the underdogs of Open Banking.

The Americas

Usually, when people think of who’s who in Open Banking in Latin America, they think of Brazil. Here are three other countries that deserve to be commended on their efforts:

  • Mexico was among the first in Latam to begin regulating Open Banking with the Fintech Law, in 2018, which required financial institutions to establish API standards for data sharing. In March 2020, the Comisión Nacional Bancaria y de Valores (CNBV) launched the first draft of Open Banking rules. In June 2021, secondary rules emerged and over 2,200 financial entities in Mexico were expected to implement APIs to allow Open Data exchanges with third party providers. In July 2021, Citibanamex announced an API Hub platform to allow others to connect to the bank’s APIs. According to Belvo, third parties will have to wait until the end of 2021 to gain access to accounts and until 2022 until credit data will become shareable.
  • Venezuela is another interesting case. Here we encounter Fintech Venezuela, or the Venezuelan Society of Fintech and New Technologies, a fintech association founded in 2018. In April 2021, Fintech Venezuela partnered with Banco Plaza to develop an innovative fintech and Open Banking collaboration project, called Interfintech. The project rests on the platform provided by Ab4cus Tecnología and it will allow fintechs to connect with each other and with the services of Banco Plaza.
  • ColombiaAccording to Global Government Fintech, the Colombia-based government has a goal of forming a regulatory framework that seeks to introduce Open Banking voluntarily. Unidad de Proyección Normativa y Estudios de Regulación Financiera (URF), the government’s regulatory projection and financial regulation studies unit, part of the Ministry of Finance, launched a series of public-private workshops. Following these, the URF will implement the resulting regulatory framework by the end of 2021/start of 2022.

Moving North, the US only recently took small steps towards Open Banking. However, there is a burgeoning activity in the fintech sector. Canada lies in the shadow of its neighbour for now. Open Banking Initiative Canada (OBIC) is a not-for-profit organisation that gathered together finance, technology, and regulations specialists. This, combined with partnerships with organisations such as CIO Strategy Council, fuels OBIC in its Open Banking mission in Canada. At the end of March 2021, OBIC has published Canada’s first Open Banking Manifesto and, in August 2021, the organisation partnered with Open Banking Expo to boost the growth of Open Banking and Open Finance in Canada.

At the beginning of August 2021, the Canadian Ministry of Finance’s Advisory Committee on Open Banking has released a report which sets January 2023 as the target for launching Open Banking in the country, which will include SMEs and retail banking consumers.


The place where it all started, Europe has (at least geographically) the leadership of the UK (which has close to 4 million Open Banking users, according to the OBIE) and countries like Germany, France, and Spain that spearhead the movement across the old continent. Here are other countries worth looking into:

  • At the end of January 2020, in Belgium, the Association of 7 and 8 (A78) was announced. Its mission was to unite all Belgian payment institutions that are licenced to provide payment initiation services and account information services. Currently, Cake, Accountable, Digiteal, Exthand, Ibanfirst, OkiOki, and Toco are members of A78. A78’s name refers to payment services no. 7 and 8 in Annex I to PSD2. Its mission is to ensure open communication and alignment between TPPs, banks, the financial sector federation, and the National Bank of Belgium, according to Linklater’s Fintech Global report.
  • On 1 July 2021, Ukraine’s Verkhovna Rada (The Parliament) has approved a bill on payment services aimed at consumers to improve the quality of payment services. The bill provides the implementation of Open Banking in Ukraine, which will stimulate the development of financial technologies in the country since fintech companies will be able to establish mutually beneficial cooperation with banks and get more business opportunities. The new legislation expands the circle of participants in the payment market and allows non-banks and fintech companies to develop.
  • According to Nordigen, Iceland’s financial industry noticed abrupt changes due to innovative fintech solutions. Iceland’s people are reportedly open to new financial solutions and these are offered by either independent companies or retail banks. According to the Statista Research Department, in 2018, 94% of Icelanders used the internet for online banking, which is 28% above the EU average. Moreover, Iceland has at least 25 fintech startups and features the Association of Fintech Companies and the Fintech Cluster which emerged in 2018 to facilitate cooperation and innovation. So far, Iceland has no laws aimed at the fintech sector and no regulatory sandbox is set in stone. However, the country’s heart seems to be in the right place, considering that the Central Bank of Iceland has a fintech help desk meant to help those looking to launch new fintech services.
  • In Turkey, account initiation services (AIS) and payment initiation services (PIS) under PSD2 are regulated by Law 6493 (Law on Payment and Securities Settlement Systems, Payment Systems and Electronic Money Institutions No 6493). This law includes AIS and PIS as parts of payment services in Turkey, meaning that they fall under Open Banking. Open Banking service providers have to get mandatory licences to operate on Turkey’s market. These licences are issued by Turkey’s central bank which regulates the data sharing activities of Open Banking service providers. According to the regulator, customers can give their consent for providing TPPs with their financial data.


Powered by resilience and driven by seemingly limitless potential, Africa features a high degree of innovation within the fintech sector. Here are its Open Banking proponents:

  • Nigeria – The Central Bank of Nigeria (CBN) pushed to enable regulations around providing financial services aimed at improving customers’ financial lives. In mid-February 2021, CBN launched the Regulatory Framework for Open Banking in Nigeria, according to Banwo & Ighodalo. Through this framework, there are hopes of driving financial services innovation by enhancing financial inclusion, sharing and leveraging financial data with TPPs which can use it to build better solutions and services.
  • Kenya – The Central Bank of Kenya (CBK) has released a draft document outlining a five-year digitalisation plan to modernise the country’s domestic payment landscape. The document, titled Kenya National Payments System Vision and Strategy 2021 – 2025 and released in December 2020, stresses the regulator’s commitment to establishing a regulatory landscape that’s conducive to innovation, as well as embracing Open Banking and APIs. 
  • South Africa – South Africa doesn’t feature Open Banking regulations. However, according to Accenture, many banks seek to adopt it anyway. The CEOs of FNB and Standard Bank are officially talking about platform banking, while both Nedbank and Absa have made Open Banking-related investments. In January 2021, South Africa-based fintech Spot Money has launched the first Open Banking offering in the country, based on Mastercard’s technology. According to CNBC Africa, in March 2021, the South African Reserve Bank has initiated consultations within the financial industry regarding consumer data and cyber security risk management related to Open Banking-enabled payment solutions, particularly in the ecommerce space.

The Middle East

As we previously mentioned, culture plays a huge part in how Open Banking and financial services act around the world. The Middle East is no exception, with Islamic finance being a force to be reckoned with in this area. Open Banking is mostly in its infancy in the Middle East, although some countries stand out:

  • Bahrain – Starting with 2017, the Central Bank of Bahrain (CBB) began working on regulations around Open Banking and in 2018 it released Open Banking rules that followed PSD2’s guidance. In October 2020, the CBB launched the country’s Open Banking Framework and in May 2021, we heard that retail banks made progress on complying with this framework following the end of the implementation’s grace period in April 2021.
  • UAE – The Central Bank of UAE alongside the DFSA and ADGM (state regulators) are avid supporters of Open Banking, according to Arabian Business. These structures seek to boost the country’s economy by allowing financial services to adopt Open Banking. UAE-based banks that are subsidiaries of Europe-based banks must adhere to EU banking regulations (such PSD2) and UAE-based PSPs look to ensure that financial institutions follow Open Banking regulations. It is expected that 88% of UAE banks will open up to Open Banking by the end of 2021.
  • Saudi Arabia – According to strategy& (PwC), Saudi Arabia plans to launch Open Banking in the first half of 2022, after announcing an Open Banking framework. In January 2021, the Central Bank of Saudi Arabia launched an Open Banking policy in an effort to diversify financial services in the country. A small number of banks combined with a fintech ecosystem teeming with potential makes Saudia Arabia a country ripe for Open Banking.

Although some regions are less discussed than others, this doesn’t mean that their progress goes unnoticed. In the grand scheme of things, Open Banking’s ripple and trickle-down effects ensure that financial services all across the world evolve, banks and fintechs learn to cooperate, and, most of all, the customer finds more knowledge and power in dealing with their financial life.

At the moment of writing this article, the universe of Open Banking is in a state of entropy, with some countries making more progress than others. What’s important is that, regardless of the cultural background or position on the globe, there is a willingness to adopt Open Banking, or at least gauge its potential, to drive more financial innovation, diversity, and user experience improvement.

About Vlad Macovei

Vlad is a content editor at The Paypers working on the Banking & Fintech team, where he uses his research, content, and people skills for all activities revolving around Open Banking, Open Finance, Banking-as-a-Service, and more. Vlad has a degree in Biology and Molecular Genetics and an extensive background in creative writing. You can reach out to him via LinkedIn or email (vlad@thepaypers.com).

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Keywords: Open Banking, Open Finance, data sharing, banks, fintech
Categories: Banking & Fintech
Countries: World
This article is part of category

Banking & Fintech