Last editedJun 20223 min read
Open banking is unlocking a world of new possibilities in the financial sector, allowing users to manage their money with greater security and convenience. At the same time, businesses can offer more flexible services to their customers. There’s a wealth of open banking providers out there to facilitate this transfer of financial data. Before determining whether your business could benefit from open banking solutions, it’s helpful to know who the best open banking providers are. Here’s a rundown of the current major players.
What do open banking companies do?
No matter their focus and features, open banking companies act as third-party middlemen between users and banks. They give access to relevant financial data using APIs (application programming interfaces).The API serves as the bridge between two systems or software.
There are two primary types of third party providers, including:
Account Information Service Provider (AISP): aggregates financial data from banking institutions
Payment Initiation Service Provider (PISP): initiates payment without log-in details or using a card
Both services require full consent from the consumer before data can be accessed or managed. By using open banking providers, businesses give customers greater control over their data and can provide better financial services at the same time.
Features of the best open banking providers
There are some obvious features that the best open banking companies have in common. The first is that they’re secure. The second is that they’re focused on time-saving convenience. However, within the framework of open banking, there are several types of companies you might come across.
Open Banking platforms: Focus solely on open banking technology and services
API platforms: Focus on the development and management of open banking APIs
Aggregators: Focus on aggregating financial accounts enabling the sharing of data across platforms
Who are the current open banking solution providers?
Only a few years ago, open banking was still a very new concept with few major names in the field. Today, there’s an increasing number of fintech start-ups joining the established players. Here are a few of the best open banking providers, both past and present.
GoCardless offers two key solutions using open banking technology, Instant Bank Pay and Verified Mandates. The first enables instantly confirmed bank-to-bank payments, while the second works to verify account ownership safely and securely. Instant Bank Pay works in tandem with GoCardless’s existing bank debit capabilities to give merchants more payment solutions. If your customers don’t have online banking, they have other options on hand to reduce failed payments. With Instant Bank Pay, payments are confirmed in under 10 seconds – all at half the price of card payments. Currently this is only available for US businesses taking payments from the UK, but the service is expanding rapidly across the global marketplace.
With multiple platforms to choose from, your business can make the most of open banking’s myriad benefits. It’s worth looking at how these various platforms can integrate into your existing banking systems, for faster, more efficient payments.
2. Plaid Exchange
Based in San Francisco, Plaid is an aggregator that works as a third-party bridge between multiple apps and banks. Financial services like Robinhood, Venmo, and Square all use Plaid to access customer account data. The company recently launched Plaid Exchange to provide a more full-service open banking solution. It now connects to over 1000 financial institutions and an array of partners.
Most businesses will already be familiar with Oracle’s extensive software suite and banking products. The company has branched out to offer an array of APIs designed for open banking, integrating naturally with its core financial features. At the moment, Oracle provides over 1600 APIs to give wider access to its core banking system. If you already use Oracle technology, this could be a natural fit. However, those who don’t might not find this to be the most convenient solution. There are also high maintenance fees involved.
Acquired by Google back in 2016, Apigee is now offered as the Apigee Open Banking APIx. Its API management platform services big-name clients like PayPal, Goldman Sachs, Equifax, and others under the Google umbrella. It offers the benefit of natural Google Cloud integration as well, but this service doesn’t really go beyond its API management features. It won’t help you with a custom open banking solution or full-service payment collection.
We can help
GoCardless is a global payments solution that helps you automate payment collection, cutting down on the amount of financial admin your team needs to deal with. Find out how GoCardless can help you with one-off or recurring payments.