Open Finance: a new growth lever for SMEs

Ekmel Çilingir, Chairperson of the Supervisory Board at EMBank, discusses how PSD3 unlocks Open Finance in Europe, expanding secure data sharing to boost SME trade, faster payments, better risk decisions, and growth.

Europe is on the cusp of a shift in payments and data sharing that will reshape how businesses pay, borrow, and grow. The upcoming Payment Services Directive 3 (PSD3) is not merely a regulatory update, but a gateway to Open Finance, where SMEs, corporates, and consumers can securely share financial data across providers to access better pricing, faster payments, and broader markets.

Europe has demonstrated its maturity in Open Banking, which serves as a lever of innovation and inclusion, as I noted in an earlier article on Lithuania’s fintech momentum. While the EU now counts tens of billions of Open Banking API calls annually, Lithuania – where EMBank is based – is distinguished as one of the Union’s most advanced hubs.

PSD3 will expand to savings, pensions, investments, insurance, and trade. It will impact risk assessment, trade finance, and cross-border cash flows. Here is why we should embrace it not only for compliance but as a growth strategy.

A hard truth: correspondent banking retrenchment has hurt SMEs’ trade

Over the past decade, many banks have cut correspondent ties due to sanctions risks, AML fines, and compliance costs. Trade finance frictions rose, and SME exporters/importers bore the brunt. Fewer correspondent lines meant:

• Longer settlement chains, higher costs, and opaque fees.
• Tighter access to letters of credit and collections, especially for ‘thin-file’ SMEs.
• Slower onboarding for small suppliers needing to move quickly.
• Greater FX and counterparty risk as SMEs patched together inefficient payment routes.

Add tariff walls and geopolitical fragmentation now, and you get a dangerous equation: demand exists, but the pipes – settlement, compliance, data-sharing – get clogged.

How Open Finance can reopen trade pipes for SMEs

Richer, portable data → better SME risk assessment: traditional trade finance relies on documents and relationship history – hard for new or small counterparties. Open Finance adds continuous cash-flow telemetry (payments, payroll stability, tax evidence), ERP data, and even logistics milestones. It would lead to faster, more accurate underwriting for invoice discounting, purchase-order finance, and supply-chain finance.

Account-to-account payments at scale → cheaper, faster settlement: card rails are valuable but not always efficient for B2B invoices. PSD3 strengthens account-to-account (A2A) alternatives with better security and harmonised APIs. SMEs benefit through lower costs, fewer chargebacks, and quicker fund availability – vital for working capital.

Direct PSP access and fewer arbitrary roadblocks → better competition: if PSD3 delivers on transparent refusals and improved non-bank access to clearing infrastructures, SMEs gain more providers for payments, FX, and working-capital solutions. That choice bends cost curves.

Programmable compliance → speed without shortcuts: with standardised data, TPPs and banks can embed real-time AML/sanctions checks and Confirmation of Payee at initiation, cutting false positives and manual back-and-forth. Compliance becomes the engine that enables speed with safety.

Cross-border interoperability → a real single market for payments: harmonised APIs and security profiles mean a Lithuanian SME selling to a Dutch wholesaler can get consistent payment initiation and data access. Friction falls at every step – from quoting and FX hedging to invoicing and settlement.

Why PSD3 matters to SMEs

SMEs are demonstrably the growth engines of Europe, and PSD3 offers them tangible benefits. First, it expands Open Banking into Open Finance. Being able to share savings, insurance, investment, and trade data through a single secure corridor will reduce manual processes and accelerate decisions based on real-time cash flow and payables.

Second, PSD3 strengthens trust and security. Features such as Confirmation of Payee, stronger authentication, and clearer liability rules lower fraud losses and disputes – vital for SMEs operating on thin margins. It also curbs unfair practices: banks that deny access to regulated providers will have to justify those decisions in writing, ensuring SMEs benefit from a more competitive market of lenders, PSPs, and fintechs.

Finally, PSD3 can deliver efficiency gains despite higher compliance costs. Smaller banks and PSPs do face upfront investment, but automation of KYC/AML checks, lower card fees through account-to-account payments, and faster lending decisions will generate returns. Partnerships with fintechs and SaaS vendors will help firms meet technical requirements without heavy overhead.

Conclusion: focus Open Finance where ıt matters

Europe is not starting from zero. Open Banking and fintech collaboration have already changed finance’s operating system. 2026 is the bridge to a more data-centric model; we must direct the data to sectors that drive growth and innovate faster, especially tradeable SMEs.

Europe’s export engine must be unclogged by raising data quality and decision speed. Open Finance can become a genuine instrument of trade policy, not just a tech trend. The next challenge is proving it can power SME trade and growth. It’s a fair deal: banks open further, TPPs step up on compliance and resilience. Europe has the framework and the talent – let us aim Open Finance squarely at SME commerce, and growth will follow.

This editorial piece was first published in The Paypers' Open Finance Report 2025, the latest comprehensive market overview and analysis focusing on the key players and products within the Open Banking and Open Finance ecosystem. Download the full report to discover more insightful content.

About the author

Mr. Ekmel Çilingir is Chairman of the Supervisory Board at EMBank. An economist by profession, his career spans over two decades across Europe. He started at Akbank, held managerial positions at BNP Paribas Fortis (Malta) and Credit Europe Bank before joining EMBank. He writes regularly on banking regulation, fintechs, and strategic transformation, actively contributing to the thought leadership of the financial services industry.

 

About the company

European Merchant Bank (EMBank) is a digital bank licenced by the European Central Bank and headquartered in Lithuania in 2019. Currently, EMBank provides banking services (Lending, Accounts, Payments, etc.) to Lithuanian Businesses, contributing to the Lithuanian economy and concomitantly supporting the growth of businesses. On the other hand, EMBank is banking with fintechs by giving account and payment services for their growth.