Increases in consumer awareness and digital readiness have caused an uptick in the adoption of Open Banking, with many Open Banking markets finally beginning to reach maturity. Within this ecosystem, Europe is home to some of the world’s most advanced markets. Compared to other regions globally, Europe has the highest number of Open Banking platforms and products on offer.

While the UK and Scandinavia were the Europe’s Open Banking early adopters, developments across the DACH region of Germany, Austria and Switzerland have hit an exciting pace during 2023. Kamran Hedjri, Group CEO at PXP Financial, looks at who is leading the way in this region, and where progress is still to be made.

Germany: The banking giants have awoken
Considered by many as the birthplace of Open Banking, it’s perhaps surprising that 30% of German banking executives holding negative views on Open Banking in 2019 – double the 15% average across Europe. Though PSD2 has driven Open Banking in Germany and throughout Europe, many feared that implementing the PSD2 requirements would mean losing the competitive edge when it came to innovation.

Now, the picture is very different. Open Banking reforms are advancing and, as of June 2022, Germany boasted the second-highest number of third-party providers with the EEA. German bankers are clamouring for more radical change in the industry and highlighting the need to go even further than the PSD2 framework to embed financial services into customer experiences.

German banks have had to digitise quickly to compete with FinTechs, though they may have been bolstered by a preference for traditional banking among German consumers. Some of the biggest names in German banking are now seizing the Open Banking opportunity, although their journey has not always been easy. Famously in 2019, talks regarding a merger between giants Deutsche Bank and Commerzbank collapsed. Some have wondered whether the advent of Open Banking could spell the end for such mergers, unifying banks without the need for complicated deals.

Austria: Continued growth demands regulatory action
The Austrian FinTech sector has continued to grow at a steady pace, with an increase in the number of domestic startups. Despite growth across sectors such as investments, insurance and accounting, payments dominates the Austrian FinTech scene.


Although the disparate size makes direct comparisons difficult, Austria boasts 65 bank APIs – not far behind Germany’s 80. When it comes to banks and account providers, though, Austria’s total of 65 is dwarfed by Germany’s astonishing 961. Germany is something of an anomaly here, other markets considered strong adopters of Open Banking have much fewer bank APIs – the figures for the UK and Norway, for example, are closer to 200. Austria can be seen as sitting somewhere between Ireland, which has 22, and France, which has 89 – though as a market it bears stronger resemblances to Germany.

While Open Banking is being embraced by Austrian banks and FinTechs, and the country should be considered a strong adopter, there is a tangible need for the regulator to work more closely with the industry to deliver guidelines that are fit for purpose as the ecosystem evolves. This will be a key area to watch as Open Banking becomes ever more embedded into the Austrian financial sector.

Switzerland: Traditional attitudes to banking hold sway
With just 15 banks and account providers offering Open Banking, and 14 bank APIs, Switzerland differs greatly to Germany and Austria. The approach to Open Banking in Switzerland can be seen as highly market led, with its regulators operating under totally different conditions to its EU neighbours. Although later than its EU counterparts, Switzerland is set to benefit imminently from a real-time payments infrastructure, a sign that market demand for fast payments and Open Banking is increasing.

Switzerland’s highly banked population has a strong preference for cash, as well as payment cards, which make up 42% of the value of its eCommerce transactions. Consumers are also loyal to their existing bank; 6% have never changed their primary bank and 94% do not plan to change banks, however, 49% would access an Open Banking service if they did not have to change their primary bank account.

This preference for a primary bank account could make consumers less likely to trust the data sharing involved with Open Banking, however, there are positive signs for the future. Swiss consumers are already embracing Open Banking principles by adopting e-bills, which appear in banking interfaces with one-click push payment capabilities. This is just the beginning, as the Swiss Infrastructure and Exchange (SIX) group has expressed interest in building Open Banking into its intelligent billing platform, and plans to extend this to eventually use customer data for other services such as financial management and lending.

The secret ingredient fuelling Open Banking adoption
The European Commission has announced it will introduce PSD3, in a move that should propel the adoption of Open Banking further across the region. With this regulatory attention driving adoption, Europe is set to become the world’s largest Open Banking market in 2024.

However, regulation alone is not enough to deliver Open Banking adoption across the board – as the example of Switzerland demonstrates. Collaboration throughout the payments ecosystem will foster the innovation and consumer interest needed to see more Open Banking maturity throughout the DACH region and beyond. Selecting a payments partner with local knowledge, regulatory expertise and a focus on innovation, like PXP Financial, is essential.

PXP Financial is a complete, omni-channel payment provider that helps businesses accept payments online and on-premise. We offer an online and POS solution, alternative payments, collection services, card acquiring, and risk management, as well as a variety of value-added services, including checkout pages, reporting, revenue optimisation, tokenisation, dynamic currency conversion, instalments, and recurring payments across multiple channels.