Open Finance represents the next phase in the evolution of financial services innovation, building upon the foundation established by Open Banking. While Open Banking introduced the concept of securely sharing customer data with trusted third parties, Open Finance takes this concept to new heights. It expands the scope beyond transactional data, encompassing a broader range of financial information such as savings, pensions, investments, insurance, mortgages, and other crucial aspects of personal finance.
By embracing Open Finance, customers gain greater control and transparency over their financial lives. Customers can access a comprehensive view of their financial information, enabling them to make more informed decisions and unlock a host of innovative services tailored to their specific needs. Third-party providers, armed with a wider array of data, can deliver personalised solutions that go beyond traditional banking offerings, revolutionising how individuals manage their finances and interact with financial products and services.
Open Finance represents a significant shift towards a more interconnected and inclusive financial ecosystem. It fosters competition, encourages innovation, and empowers consumers by giving them the freedom to securely share their data with innovative providers who can offer personalised solutions and improved financial experiences.
At CFIT, we recognise the transformative potential of Open Finance and are committed to driving its adoption and advancement. Through our collaborative efforts, we aim to shape the future of finance, ensuring that Open Finance becomes a catalyst for positive change and delivers tangible benefits to individuals, businesses, and the financial industry as a whole.
Our vision is for the Open Finance Coalition to become the centre of collaboration and cooperation between fintechs, insurtechs, regtechs, academics, banks, government and more.
Our aim is to build mutual trust and foster a sharing of data that can build the crucial datasets needed to unlock innovation and scalability across the financial technology sector.
CFIT will bring together the range of groups involved in the development of Open Finance, with the aim to uncover and gain insight into the mutual challenges they face. The CFIT Open Finance ‘Mission Control’ team will support the creation of working groups to help identify the enabling technologies, standards and policy changes needed to unlock key datasets. These newly created datasets will be required to facilitate fast-paced scalability within UK financial innovation.
Using the datasets and insights created from the working groups, CFIT will create 2 ‘use case’ groups that will identify solutions to some of the critical challenges that SMEs and consumers are currently facing in the UK.
1 in 6 over 55s have no private pension savings and 38% of the working age population are not saving enough to be able to maintain the same standard of living when they retire.
The UK faces a £350bn retirement savings gap by 2050, with UK savers needing to find on average an extra £10,000 each year between now and retirement to meet this gap.
1 in 4 UK adults have less than £100 in savings (MAPS) and in the October 2022 Financial Lives survey conducted by the FCA found that 12.9 million adults in the UK had low financial resilience.
The average (mean) UK unsecured debt has increased 25% from £11,176 in 2021 to £13,941 in 2022 (StepChange).
Fewer than half of UK adults maximise their tax-free ISA allowance (Sanlam, 2021).
One third of SMEs believe they will not survive the year without financing: 60% of SMEs are not currently confident they can secure finance from banks.
Three-fifths of small and medium enterprises said that they currently need funding to ease day-to-day cash flow issues (Channel Capital, Nov 2022). There are currently around 5.6 million SMEs in the UK, meaning that 3.3m need access to finance. However, over half of the 500+ businesses surveyed said that banks were too slow in assessing business loan applications.
60% of SMEs are not currently confident they can secure finance from banks.
Without financing the number of SMEs is likely to reduce drastically: One third of SMEs believe they will not survive the year without financing.
Given the importance of finding solutions to the current cost of living challenges, CFIT firmly believes that this work will provide the best opportunity to have the biggest impact in the shortest time on the financial well-being of millions of UK consumers and SME businesses.
Our esteemed first wave of CFIT Coalition Partners are at the forefront of driving innovation in Open Finance. Together, we are unlocking the vast potential of this transformative concept and reshaping the future of the financial industry.
Our dedicated and diverse group of Working Group Members plays a crucial role in shaping the future of Open Finance. With their expertise, passion, and collaborative spirit, we are driving meaningful change and pioneering innovative solutions within the financial landscape. Together, we are unlocking new possibilities and creating tangible outcomes that propel the adoption and advancement of Open Finance. Join us as a Working Group Member and contribute to the collective vision of a more connected and inclusive financial ecosystem.
Becoming a CFIT Partner will give organisations the opportunity to contribute to the discovery of solutions that will positively impact the lives of millions of UK consumers and SME business owners.
The CFIT Partner badge identifies your organisation as a contributor to the critical work that is needed to unlock financial innovation scalability and drive UK growth.
Find below CFIT’s Open Finance meeting minutes and discover more on our work to unlock the potential of Open Finance for the UK economy.
First Coalition Partner meeting minutes Friday, 21 July 2023
Mission Control Minutes 24 August 2023
Mission Control Minutes 21 September 2023
Mission Control Minutes 19 October 2023