As explained by association officials in the press release announcing the launch, with the introduction of PSD2 in 2016 consumers and businesses were given the right, for the first time, to access their payment accounts via trusted third-party providers (Open Banking). Open Finance is presented as the next step in the evolution of Open Banking and it promises to give consumers and businesses greater control and visibility of their economic lives.
Nilixa Devlukia was named Chair of the organisation. Devlukia has previously held senior roles at the Financial Conduct Authority, the Open Banking Implementation Entity, and the European Banking Authority. According to the new Chair, ‘through the promotion of an API-focused agenda in both payments and data, OFA aims to promote a healthy and sustainable fintech ecosystem, in which consumers and businesses all benefit from improved, innovative services.’
OFA’s primary focus is to bring together leading fintechs to help drive the move towards Open Finance across Europe and believes secure, open APIs are key to competition and innovation in this space.
OFA priorities are to enable consumers and businesses to access their data across all their financial accounts, and make use of it via trusted third-party providers. The association will reportedly focus on developing and driving the adoption of a competitive and convenient instant payment method based on open payments.
For this goal to be met, the OFA explains that financial institutions need to be required and incentivised to open a broader range of financial accounts, other than just payment accounts. Moreover, access needs to be facilitated using secure APIs, ensuring the right level of trust and willingness to share data. This will expand consumer access to better financial products while guaranteeing optimal control of their data.
The association manifest dictates that this goal can be met by incentivising financial institutions to provide high-quality payment APIs and user journeys. Full coverage of instant account-to-account payments, free to consumers is a must, and cross border barriers such as IBAN discrimination must be removed.
Financial institutions must open access to data and payments to third-party providers via secure, open APIs. Harmonisation of rules and standards is necessary in order to minimise fragmentation and promote consistency. This can be achieved, the OFA explains, through the creation of an independent Open Finance standards body to oversee implementation and maintenance of Open Finance APIs.
The OFA promotes a system of clear rules and guidelines to provide commercial opportunities for both third-party providers and financial institutions to benefit from Open Finance.
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