Open banking customer numbers rise to over two million

The Open Banking Implementation Entity (OBIE), the body set up by the Competition and Markets Authority (CMA) to deliver open banking in the UK, has announced that over two million customers are now using open banking-enabled products.

The figures represent a significant upswing in the use of open banking technology despite the disruptive effects of the COVID-19 pandemic.OBIE figures show open banking user numbers have doubled since January 2020. There has been a steady increase at a rate of around 160,000 users per month, which only plateaued in April and May when lockdown measures in the UK were introduced before the strong growth resumed.

Research sponsored by Nesta Challenges’ Open Up 2020 Challenge, shows a sharp increase in the use of money management apps during the pandemic, of which 45 per cent were 25-34-year-olds. According to the survey of 2,000 UK adults in early July 2020, one in five started using online banking apps during lockdown and 54 per cent now use them regularly.

Imran Gulamhuseinwala OBE, Trustee of the Open Banking Implementation Entity (OBIE), said “Open Banking used to be the best-kept secret in financial services. With 2m active monthly users and growing strongly that is clearly no longer the case. We can now see that people want to exercise their rights over their data and will do so, as long as you make it simple and secure. Open banking enabled products are rebalancing the market in favour of consumers and small businesses. Users are now able to engage more with their finances and getting access to better products.”

David Beardmore, Ecosystem Development Director, the Open Banking Implementation Entity (OBIE) said “I’m excited to see the 2 million users threshold passed so quickly. Open banking will revolutionise the way we pay. While open banking payments are currently a small proportion of open banking usage, recent strong growth is a sure sign that people welcome more payments choice. We predict that payments will eventually form a considerable proportion of our growing user numbers.”

Dr Bill Roberts, Head of Open Banking at the CMA said “When the CMA investigated retail banking, we found banks were not working hard enough for consumers, and so we required them to give people control of their own data. By doing so, we believed this would unleash a wave of innovation and stimulate rivalry.”

“The fast growth in personal customers and small businesses using Open Banking during 2020 – and hitting the 2 million mark – is another important milestone towards that goal.”

Freddy Kelly, Co-founder & CEO of challenger credit reference agency Credit Kudos said “It’s really positive to see Open Banking user numbers doubling in such a short, and challenging, space of time. Open Banking technology has been crucial in maintaining access to credit during the pandemic by giving banks and other credit providers access to borrowers’ real-time financial transaction data. It enables lenders to make more informed decisions, opening a much wider range of borrowing solutions and potential better rates for customers. We as a challenger credit reference agency will continue to work with the industry and OBIE to champion Open Banking and its role in providing bespoke financial services that suit people’s needs.”