At its core, open banking is about facilitating secure data sharing between organizations, including traditional banks, financial technology companies and third-party providers (TPPs). It’s about giving consumers and small businesses the power and rights to control their own data.
Creating better financial experiences
More data leads to better insights and solutions, enabling consumers and small-and-medium sized businesses to get faster access to more financial products and services.
Having increased freedom to exchange data also allows fintechs, banks and TPPs to more easily create new applications that reduce barriers to accessing financial services. Equifax is committed to working with Canadian lenders of all sizes to broaden access to financial services.
Lowering costs and improving operational efficiencies
Open banking enables direct and secure access to source data, removing the cost and complexity of manually sourcing, entering and verifying information. Companies will be able to boost innovation with the freedom and confidence of using verified data that gives them far more insights into what their customers like and dislike.
These benefits will help companies make better strategic decisions and encourage them to partner with other organizations, which could result in lower costs and improved efficiencies across the ecosystem.
Enabling small business
With open banking, banks and fintechs will be better positioned to anticipate the needs of the small business community earlier in their growth journey and be more targeted in how they position and price financial products.
In turn, small- and medium-size companies will benefit from enhanced insights that come from other open data sources, which will help them better manage cash flows, inventories and more. These capabilities could be integrated into various banking and fintech properties to both strengthen loyalty and improve ongoing risk and account management.
Improving the overall economy
Canada’s move to open banking will also give the economy a boost. McKinsey and Company estimates that countries that embrace financial-related data sharing could see their GDP increase by between 1% and 5% by 2030, with economic benefits flowing to consumers and financial institutions.
This is a result of increased productivity and innovation. If Canadians can tap into more effective financial products for their individual needs, they’ll have an increased ability to grow their wealth and contribute to the economy.
We want to help Canadians live their financial best. To learn more about how understanding open banking in Canada can help boost you business growth, please contact your Equifax Account Representative. You can also reach us directly at 1-855-233-9226 and follow us on Twitter and LinkedIn.
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