Open Banking is no longer a niche innovation; it’s fast becoming a mainstream payment solution that retailers should seriously consider.
As the UK sees widespread adoption across industries, David Cox, Payments Strategy Lead at Virgin Media O2, a speaker at this year’s Open Banking Expo, shares his personal insights on how Open Banking is reshaping the payment landscape and why retailers should explore it as a new option for their customers.
In your view, what are the biggest misconceptions retailers still hold about Open Banking payments?
Some merchants are struggling to secure a business case as conversion rates are difficult to predict and, depending on what the product is, some are still cautious about what the final consumer protection will look like.
What tangible benefits does Open Banking bring to the customer purchase journey – from discovery to checkout and beyond?
AIS and PIS can be used to make the onboarding journey very slick and result in less effort from the customer. Also, the fact the flow is authenticated means less fraud risk.
How do you see Open Banking payments evolving over the next 12–24 months, particularly in retail and ecommerce?
Over time, I see more merchants being able to stand up a business case to evidence; benefits outweigh costs.
Do you think retailers who delay adoption risk being left behind – and if so, in what way?
I would not use the term left behind since there are so many other very good slick payment options like Apple Pay, Google Pay, PayPal, and, more recently, Click-To-Pay. However, merchants may find Open Banking offers lower transactional fees.
If you could give one piece of advice to retailers considering Open Banking payments, what would it be?
Spend some time with some open banking providers to understand the integration and customer journey at a more detailed level.
As a major subscription-based provider, what opportunities do you see for Open Banking in recurring payments or real-time bill settlement?
Open Banking has already been proven by HMRC and various credit card companies how easy a one-off bill payment can work very effectively. Recurring payments need more clarity for both merchants and customers around what the benefits to both the merchant and the consumer really are when compared to a direct debit to a card.
What are the internal conversations like around the strategic value of Open Banking – is it seen as a customer experience enhancer, or a cost-saver?
Most merchants would expect any new payment method to benefit both the consumer and the merchant.
With telcos often needing to manage complex billing and collections, where might Open Banking make the biggest impact operationally?
Open Banking can be used very effectively on some onboarding flows (more AIS) and for bill payments/overdue debt scenarios since an Open Banking flow allows a customer to see their true bank balance before they make a payment, unlike a card payment.
About Open Banking Expo
Open Banking Expo is a global community of Open Banking and Open Finance executives responsible for digital transformation across the financial services sector. Open Banking Expo was founded by Kelly Stanley and Adam Cox.
