The spring buds of open banking first emerged half a dozen years ago when Europe adopted a new directive for the financial sector that included making payments safer and more secure for consumers while bolstering the competitiveness of non-banks by standardizing data sharing.
Embraced not only by the EU, but also the U.K., New Zealand, Japan and Australia, open banking has changed the global paradigm for financial services operations. In Canada, open banking remains a twinkle in the eye of credit unions, albeit an increasingly brighter one.
This burgeoning enthusiasm for open banking is being accelerated by the realization that, in a COVID-19 world, a new, expanded payment system may help economic recovery. The pandemic, somewhat ironically, has also helped pave the way for a transition to open banking by forcing credit union members and other financial consumers to become more digitally savvy, with isolation protocols accelerating online banking and an openness to innovation and change.
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