Despite the slow pace of its implementation, retail banks in Europe are under no illusions about the threat that open banking ultimately represents to their business. With the revised Payment Services Directive Two (PSD2) having come into force at the beginning of this year (although final terms are not due until September 2019), the writing is seemingly on the wall for traditional bank payments services.
New payment initiation service providers (PISPs) and account information service providers (AISPs) will now be able to initiate transactions and retrieve balance and transaction data from any bank account, providing that the customer has given their consent. A survey by Accenture shows that more than 50% of consumers will use a PISP product providing that they are certain it is secure; and that one in 10 credit card payments and one in three debit card payments are expected to move to a PISP by 2020.
This leaves the retail banks with the costs of account infrastructure but not the revenue from its day-to-day activities. They have, therefore, been swift to establish AISPs and PISPs of their own. ING-owned Yolt allows customers to view all their accounts and credit cards in one place, as well as providing spending categorization and budgeting tools.
