From risk to resilience: building trust in the Open Finance era

Jim Wadsworth, Chief Revenue Officer at Invela, shares insights about Open Finance’s biggest risks – data breaches, scams, and systemic fragility – and how to overcome them.

Open Finance promises a more competitive, inclusive, and innovative financial ecosystem – where end consumers and businesses control their data, and providers compete to serve them better. But with promise comes risk. And the industry has been slow to confront it with the urgency it demands.

The ecosystem is scaling rapidly. Yet its defences remain dangerously fragmented. Financial institutions face opaque risks from third-party access. Aggregators lack visibility into downstream behaviour. Third-party providers are vulnerable to compromise. End consumers and businesses are exposed to breaches they can neither see nor control. And regulators, constrained by sectoral mandates, are unable to stitch together a coherent defence.

Real-world breaches – from impersonation scams and mobile app vulnerabilities to consent overreach and API key exposure – have exposed systemic fragility. These aren’t edge cases. They’re symptoms of a model where risk is distributed but accountability is not. Financial institutions shoulder disproportionate liability without insight. Aggregators are blamed for failures they can’t foresee. Third-party providers, often inexperienced and under-resourced, struggle to defend themselves. End consumers and businesses are left to manually revoke access, often unaware of who holds their data or how it’s used.

The result is a credibility gap – one that recent failures at PayPal, Wealthsimple, and TransUnion have laid bare. These incidents weren’t just technical glitches. They were governance failures. They revealed how unmonitored third-party behaviour can bypass safeguards and blindside even the most regulated institutions. And they showed how trust – Open Finance’s most vital currency – can be devalued overnight.

This fragility is compounded by structural blind spots. Thousands of fourth, fifth, and nth party providers operate legally beyond the perimeter of regulatory oversight. Consent flows remain vague and bundled. Cybercrime intelligence is siloed. And liability is unbalanced – often leaving banks, credit unions and building societies exposed to remediation costs and reputational damage without recourse.

Consumers, meanwhile, are expected to manage data access manually, often without knowing who holds their data or how to revoke it. If they opt out, the Open Finance ecosystem loses its purpose. And if regulators are left to patch sector-specific gaps, implementation will be slow, duplicative, and expensive.

The message from industry is clear: we need better tools, shared infrastructure, and a way to align risk with reward.

That’s why Invela exists.

Invela is a first-of-its-kind Open Finance risk management network – shared, scalable, and purpose-built to address the systemic challenges holding Open Finance back. It replaces opacity with insight, fragmentation with federation, and risk diffusion with proportional accountability.

Its three integrated services – Accreditation, Risk Indicator, and Warranty – offer a comprehensive, commercially viable solution:

• Invela Accreditation provides a standardised framework for vetting third-party providers. It enables data holders to make confident, evidence-based decisions about who accesses their customers’ data, and allows aggregators and third-parties to complete one accreditation to access many data providers – reducing friction, duplication, and cost.
• Invela Risk Indicator delivers continuous, real-time monitoring of third-party behaviour. It’s not just a score – it’s a dynamic signal that helps participants identify emerging risks, act decisively, and maintain compliance without slowing innovation.
• Invela Warranty offers a third line of defence: an insurance-backed mechanism that compensates data holders when losses occur. It’s informed by the Accreditation and Risk Indicator, creating a virtuous circle of accountability and protection.

Together, these services transform how risk is managed. Banks and building societies move from blind exposure to intelligent stewardship. Aggregators gain operational resilience. Third-party providers become trusted participants. And consumers benefit from frictionless protection and empowered participation.

This isn’t theoretical. It’s operational.

Invela is built to scale across jurisdictions, adapt to evolving regulation, and support the Open Finance ecosystem we all want to see. By reducing compliance burden, accelerating onboarding, and aligning incentives, it helps the ecosystem move faster, safer, and smarter.

Because if we want Open Finance to deliver on its promise, we need more than pipes and APIs. We need trust, transparency, and resilience.

That’s what Invela delivers.

And that’s why it matters.

About the author

Jim is Invela’s Chief Revenue Officer, with 25+ years in banking and payments. He led Mastercard’s journey into Open Banking, including driving key acquisitions. Prior to that he was responsible for Vocalink's delivery of critical national infrastructure payment services in the UK, and where he drove innovative anti-financial crime solutions.

 

 

About the company

Invela is an Open Finance risk management network. Its mission is to foster transparency, resilience, and innovation by protecting financial institutions from third-party risks and enabling safer data exchange across the ecosystem. It delivers this through accreditation and real-time risk monitoring of participating third-party providers, alongside an insurance-backed warranty.