Whitepapers > Understanding the Journey Stages of Open Finance

Understanding the Journey Stages of Open Finance

cover

Understanding the Journey Stages of Open Finance

Open Finance puts financial data in the hands of consumers and enables them to choose the financial services that best meet their individual needs — both inside and outside of the bank. It is the ability to access and act on financial data to build personalized experiences, increase the pace of innovation, and drive industry collaboration. 

MX’s vision is a more open, frictionless, and secure financial ecosystem where everyone can access and act on financial data. The future of Open Finance puts the consumer experience at the center — where transferring funds, applying for loans, or making a payment is instant and embedded. We see 5 critical stages along this open finance journey for financial institutions and fintechs alike: 

  1. Build: Modernizing infrastructure and APIs to enable data access and seamless connectivity.
  2. Collaborate: Prioritizing secure data access and data sharing with open finance APIs.
  3. Drive: Leveraging data to drive new innovation, revenue streams, and decision making.
  4. Lead: Building personalized, automated experiences and exploring embedded finance products and services. 
  5. Innovate: Fully embracing Open Finance and innovating the way forward to more beneficial ecosystems. 

STAGE 1: BUILD

Organizations in the Build stage know that modernizing their infrastructure and APIs is critical enabling data access and seamless connectivity. They are building the foundation to better enable their business to meet consumer needs and make sure they don’t lag behind others in the marketplace. 

Characteristics: 

STAGE 2: COLLABORATE

Those in the Collaborate stage are actively focused on enabling secure and reliable data sharing through open finance and open banking APIs. They seek to reduce consumer friction and increase connectivity wherever possible. 

Characteristics: 

STAGE 3: DRIVE

Companies in the Drive stage have the infrastructure and APIs to access and act on financial data. They have the mechanisms in place to analyze data to identify opportunities for new innovation, revenue streams, and decision making.

Characteristics:

STAGE 4: LEAD

Leaders dedicate significant resources to enriching consumer experiences. They strive to build personalized, automated experiences and create embedded financial solutions to meet consumer needs. They anticipate consumer needs through machine learning and use data to improve financial wellness. They are pioneers in the market and lead by serving on forums and panels to set industry standards. 

Characteristics: 

STAGE 5: INNOVATE

Companies in the Innovate stage have fully embraced Open Finance. They have a customer-first company strategy and are relentless in their pursuit of the best consumer experiences. They partner with vendors and third parties to build beneficial ecosystems. They constantly look for ways to optimize costs, improve consumer retention, and drive innovation for both themselves and the industry at large. 

Characteristics: 

How ready is your organization to embrace the future of Open Finance? 

Take the MX Open Finance Journey Self-Assessment to help you identify where your organization falls on the journey to an open finance economy.

mx.com/open-finance-assessment