Before diving into the benefits of this banking revolution and how it can improve our day to day operations, it is key that we understand what open banking is about and why it is changing how businesses are conducting their financial planning.
What is Open Banking?Open banking is a secure and modern way to give approved providers such as Certomo, access to your financial information. It allows us to innovate and provide new products and services that can help businesses conduct their financial needs better. We can provide a much more detailed understanding of your banking portfolio, allow you to manage risks and make the most of your money. Connectivity with the bank is done via secured APIs. This stands for Application Programming Interface which is really a communication protocol or language between different parts of a computer program intended to simplify the means of transferring data between each other. There are certain regions where these APIs have been standardized by the regulator. One good example you may have already heard of is PSD2. This is the European standard by which banks communicate with third party fintech providers.
Taking advantage of financial technology
Accessing your financial data in a secured, real-time financial application can bring great benefits and minimise risks associated with latency on receiving account balances and fluctuating foregin exchange figures. Modern dashboards can aggregate all banking information wherever they may be around the world, provide your financial team real time benefits when it comes to decision making and execution of complex financial strategies such as pooling, concentration of funds and hedging across multiple currencies and financial institutions.
Fintechs will produce capabilities assisted by AI and computer algorithms that will help support cashflow tracking and dramatically improve liquidity positions. As data becomes available in real-time, analytics are conducted in state of the art software applications and easily applied and integrated into your banking platforms. Payment initiation and funds transfers are part and parcel of open banking capabilities, hence your business can leverage financial opportunities present within its own portfolio or from outside your business as financial lending options are networked into a secured marketplace where businesses can create value for other businesses.