Julien Eichinger - stock.adobe.c
Customers at Lloyds Bank and Halifax can now see all their current accounts, regardless of which bank they are with, through their mobile banking app following an the addition of open banking-enabled functionality.
The mobile apps now also give customers a view of accounts from NatWest, RBS, HSBC, Barclays, Santander, Nationwide, Bank of Scotland, Lloyds and Halifax. More banks will be added, according to Lloyds Bank.
In December, Bank of Scotland, which is part of Lloyds banking Group, introduced the functionality to its customers.
Open banking, which was introduced by the government a year ago, enables third-party financial services suppliers access to customer data – if the customer agrees – through application programming interfaces (APIs).
Account aggregation is widely seen as the first stage of adoption at banks, and is when customers can see all their accounts in one place. HSBC was an early adopter in May 2018 when it launched Connected Money, an app that enables users to view all their bank accounts in one place.
Stephen Noakes, transformation director at Lloyds Banking Group, said: “We’re focusing on taking our industry-leading apps to the next level by offering customers a fuller view of their finances. Bringing Open Banking technology into our apps is the next step in a series of exciting new features designed to make it easier for customers to manage their money online.
“We recently launched a suite of features to help online banking customers keep track of spending and help protect against fraud, enhancing the safe, secure and seamless experience our customers are used to every day,” he added.
The bank also recently announced how it had integrated with Google Maps to help customers see where they spend money. These types of open banking functionality could just be the tip of the iceberg in terms of how the regulation transforms banking.
David Bannister, analyst at Ovum, said the first year of open banking hasn’t been that dramatic, as banks and fintechs rolled out minimum-level services to comply with the regulations, such as account aggregation apps.
“Not staggeringly new, but with smartphone apps becoming the preferred way of managing bank accounts, it’s a first and necessary step that will quickly be so normal to most app users that they will think it’s no big deal,” he said.
But he added that these services, in retail banking, will lead to more advisory services: “Your bank will be able to suggest moving savings to a higher interest account, for instance. Third parties will be offering more services that will let consumers shop around for better deals – instead of going to a comparison website, the app will make suggestions.”
He also expects the first payment initiation services will allow people to make a payment from any of their accounts from one app.
Read more about open banking and PSD2
- The government’s Competition and Markets Authority has requested feedback on proposals to increase competition in the UK banking sector.
- The Competitions and Markets Authority opens up the banking apps market following an investigation into how to create greater competition in banking.
- With the EU’s Payment Service Directive (PSD2) taking effect in January 2018, banks have no time to waste in preparing for the changes it will bring.