“In three short years, Open Banking is set to ‘completely or significantly change how traditional financial services are delivered,’ even though, according to that same study, an astounding 98% of financial institutions are unprepared for Open Banking regulations. Open Banking is much needed by consumers who split meals with Venmo, invest savings via Robinhood, and budget their paycheck using Mint, as it’s set to provide an easy-to-access platform where they can view and manage all their financial information and share it amongst their various financial service applications quickly and efficiently.
The copious benefits to Open Banking are only made possible thanks to advanced technologies like artificial intelligence, which enables ‘encryption, transparent data archiving solutions and provides secure passage of information between consumers and banks without the use of passwords.’ In Open Banking, responsible data access and security is paramount, which is why AI is so crucial.
Open Banking is reliant upon communication amongst various financial service providers, and AI is uniquely efficient at combining data sources through systems like Natural Language Processors (NLP) and Financial Context Recognition (FCR). With AI, financial institutions can automate the data capture, enrich it with other third-party data (like payment apps, credit card platforms, etc.), and seamlessly archive and retain that data, which is crucial for compliance.”