LFP168 – A Superb Guide To “Open FS” Progress Around the World w/Keith Grose Head Plaid UK

Open Banking started a far greater wave, The ability for people to share ever-more of their financial data – not just current account but *everything* from mortgages to investments to pensions data promises to revolutionise the world of FS and people’s financial lives. In this excellent conversation Keith gives us a tour d’horizon and a tour de force covering Case Studies of the progress of Open Finance in the UK, Europe, US, Canada, Australia and China. All of these countries have taken very differing routes starting from very different places but are all marching in the same direction.

Open Banking itself in the UK started with a Payments Directive and is thus only aimed at current accounts so far from “open banking” is not even “open banking assets” (only payment accounts are included so eg no data on savings accounts) let alone “open banking liabilities”.

Plaid are currently in the process of being acquired by Visa for $5.7bn which shows you their importance, is the largest Open Banking provider in the US and “the only transatlantic Open Banking provider” connecting Fintechs with all these diverse sources of customer’s financial data from their providers.

Topics discussed on the show include:

  • Working in Ethiopia and diving in coral reefs
  • Keith’s career journey from maths via Google into payments and Plaid
  • Plaid’s story including its major pivot which led to its phenomenal success
  • Plaid support 3,000 applications and 80% of the largest Fintechs
  • the tech starts to recede into the background and simply enable ever-greater use-case functionality
  • the basic philosophy of “open”
  • every country in the world has been doing it differently
  • the strengths of the UK’s approach “miles ahead of the rest of Europe in implementation”
  • this as a (rare) example of great regulation that creates business opportunities not simply bureaucracy
  • the varying approaches around Europe
  • has taken much longer in Europe and several differing “standards” have emerged
  • different European markets have got further or not so far down the process
  • US – market-based approach – only just started talking about legislation
  • consequences is very painful to connect 12,000 banks as all do something slightly different with no standard – vice versa the API that “sorts” all this is of amazing value
  • Canada similar to US
  • Australia has leaped from Open Banking right to Open Finance – how they achieved this
  • “every consumer has a right to their financial data” – how this is rolling out across types of financial data
  • similar in Singapore
  • draining moats, widening gates and prising open oyster shells
  • differing motivations from banks and the karma thereof
  • China‘s approach – skipped straight to the mobile finance world – Alipay et al
  • the practicalities of an API that connects one to different banks in different countries yet with differing availabilities of data – eg open pension data is not yet widespread
  • some implications on eg even renting properties
  • the importance to peoples life of having one’s finances under control
  • the principle behind openness is going to proliferate – it’s your data not the banks data
  • “this is a global movement that is going to continue for a decade to come”
  • thinking in the UK on how to go to the next level
  • leaving EU and “smart divergence” from PSD2-driven Open Banking
  • payments and open-payments

And much much more 🙂

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