EXECUTIVE SUMMARY

The Open Banking Impact Report1 is a key tool to help policymakers and others in our ecosystem to understand how open banking is developing and whether it is helping the UK’s consumers and small businesses. The study is built on a comprehensive Theory of Change that starts by analysing the availability of different types of open banking-enabled services. It then moves through customer adoption and experience, and finally assesses whether consumers and small businesses are benefiting from open banking-enabled services. We have adopted an iterative approach, producing a report every six months, each of which builds on the previous one, populating different aspects of the Theory of Change with new insights.

New insights into open banking and its benefits

This second report represents a significant development as, for the first time, we have sufficient levels of adoption to allow us to undertake quantitative research with verified users of open banking-enabled services. We now have an emerging understanding of who is using open banking and what kind of benefits they are deriving from it. The key insights in this Impact Report are:

Availability of services continues to expand, although the pace of growth appears to have slowed. We have comprehensive coverage in three outcome areas: decision-making, payments and borrowing.

Adoption has continued to grow with 7.5 – 8.5% of digitally-enabled consumers now estimated to be active users of at least one open banking service. This is up from 5.0 – 6.0% in December 2020.

Our research found that most customers (91%) find services easy to set up and they have a positive net promoter score (NPS). Personal Finance Manager services have an NPS Score of +26, with savings apps at +8.

Most customers of these services (76%) intend to continue to use them.

Services seeking to help consumers make better financial decisions seem to be doing exactly that. Significant proportions of customers claim that these platforms are helping them keep to budgets, reduce unnecessary expenditure, shop around and minimise fees and charges.

On the savings side, we see similarly positive findings, with customers reporting that these services have helped them save more and build a financial cushion. 22% of customers of these savings apps say this was their first adult savings account, suggesting a potential broadening of savings participation.

Early adopters

For the first time we also have a picture of who these early adopters of open banking are. We know they are younger than the national average, with a slight skew to male. But more importantly, we also know that many of them lack financial confidence (27%), or are worried about aspects of their financial health. For example, how much they have in savings (43%), how much debt they have (31%) or struggling with monthly bills (18%).

Improving the UK’s financial health

This study demonstrates continued development of the open banking ecosystem, with significant growth in adoption. Importantly it also provides the first evidence that these services are starting to address some of the most significant challenges to financial health of the UK’s consumers.

1The Revised Roadmap refers to the delivery of a Consumer Evaluation Framework (or CEF). For publication purposes we refer to this as the Open Banking Impact Report