Cast your mind back to 2006, when Clive Humby – the architect of Tesco’s Clubcard  - declared that ‘data is the new oil’, ‘it’s valuable, but if unrefined it cannot really be used’. We’re all familiar with Open Banking, and Open Finance is on the horizon.

Kamran Hedjri, Founder and Group CEO of PXP Financial, explores the next frontier for digital services: Open Data. 

Every financial transaction generates data, giving organisations a hugely valuable resource right under their nose. But the value of data is in being able to extract the insight you need to make the best decision, preferably in seconds. Traditionally, data has been owned and managed by IT departments, but with data insight needed to drive every decision, data is becoming democratised.

It’s led to the creation of Open Banking, Open Finance, and going forward Open Data. You’d be forgiven for any confusion. What’s the difference? Put simply, Open Finance operates strictly within the financial services industry, while Open Data economies have the potential to move across all industries. Think beyond payments and banking to technology and transportation – and much more. It means connecting account data from other sectors such as energy, utility and telecommunications and could extend to personal health and government records as well. The goal is that one day consumers and firms will be able to see their complete financial picture all in one place. It’s exciting stuff that promises a range of benefits for businesses and consumers alike.

Open Data – what’s in it for you?

For consumers, granting access to regulated third parties to access their data opens up a world of hyper-personalisation when it comes to services and products. It provides an aggregated view of all their financial and non-financial accounts in a single dashboard, easier identification of opportunities to reduce spending and save money with the added advantage of moving the savings into the right savings products, and removes the need to provide personal information over and over again.

For TPPs it means easier access to customers and potential customers and more complete data that allows them to create highly-personalised products. Is also makes expanding globally more achievable. There are also benefits for banks who adopt Open Data beyond the compliance requirements, including holistic client information for credit checks and lending, 360-degree client views for better campaigns and marketing, and faster time to market with new products.

How close are we?

Before anyone gets too excited, there are still barriers to overcome. For example, while regulations are in place to protect consumers, there is always the risk of unscrupulous players misusing data, and that cyber-criminals could try to access financial history or make payments from an individual’s bank account.This is why customer security was added as a priority to PSD2 and the UK Open Banking standards and only regulated firms are permitted to access customer data and to initiate payments. 

It’s still early days for Open Finance, and Open Data is still further away. The first step towards a fully open economy is embracing Open Banking and understanding how it’s evolving into Open Finance.
To that end, PXP Financial has created a From Open Banking to Open Finance and beyond white paper to help merchants take that step with confidence.

As time goes on, more advantages of the open economy will become clear. We think it even has the potential to impact more than our finances – could climate emissions be reduced if banks use Open Data to incentivise more sustainable decisions from customers? Could Open Data save the world? Watch this space! 


About PXP Financial

The end-to-end payment platform: PXP Financial provides a single unified payments platform to accept payments online, on mobile and at the point of sale. Powered by global acquiring, 200+ alternative payment methods & financial services, PXP Financial family of companies processes globally over EUR 22.7 billion annually through our unified gateway. Whatever your business needs today or tomorrow, PXP Financials’ innovative payment platform will support your business growth with all the payment services you will ever need from one source, wherever your business takes you. To find out more about PXP Financial family of companies, visit: