The plight of Open Banking is dependent on consumers offering information from their current account in exchange for improved products and better deals. So, what are the chances of success?

Developments in the financial services sector over the last decade should provide a reliable marker. Let’s take the changing way people apply for credit cards as an example.

The long-established process was that people were either invited to apply, or took an educated guess that they matched the eligibility criteria for a credit card and then waited for an accept or decline.

Too often with this process, people were successful in applications for cards but could have got a better rate elsewhere, or faced the frustration and disappointment of being declined when they didn’t meet the eligibility criteria.

The agents of change have been the advancement of pre-qualification services and people embracing the value exchange – their data for an improved experience. Providers can let applicants know they stand a strong chance of being approved in advance on their own website, while price comparison sites offer a wider market at a glance.

What’s particularly interesting about how people interact with the price comparison sites is that they don’t simply choose the card with the best rate. A card with a slightly higher interest rate or shorter initial interest-free period can be more attractive than one with better rates but a lower percentage chance of acceptance.

This hasn’t been lost on credit card providers. We are regularly contacted by companies who want to improve their pre-approval process, so they can rank higher on the price comparison websites when consumers sort the tables by percentage chance of acceptance. People embraced the value exchange and lenders have reacted by improving their offering.

Although January 13 was officially the dawn of Open Banking, we can expect the related services to roll out over the coming year.

Experian’s whitepaper, Delivering value in the digital age, used research carried out with C Space to profile four different sets of the population and their attitudes to sharing data to receive a service. Financial service providers will need to understand the appetite for data sharing among these four groups if they are to make the most of Open Banking.

People who view exchanging information for products and services as a required process to get what they want, The Accepting, are the largest group and account for 41% of the population. This group seems likely to take advantage of Open Banking though they may have some reservations, so companies should outline the benefits of data sharing to them.

Another 28% are in The Cautious category, taking a safety-first approach to the data exchange and making sure the companies which request their information are legitimate and trustworthy. Transparency is key in relationships with this group, it’s worth building confidence slowly and not overwhelming them with new services.

The Unaware (22%) are most likely to click ‘accept’ for services without too much thought about how their data might be used. Financial service providers should think of ways to increase their engagement in the data sharing process so they can make informed choices.

Finally, 9% are The Incognito, who have developed methods to avoid sharing information they don’t want to. They desire a life without what they deem ‘hassle’ or ‘intrusion’. They can still be persuaded to share data, but it will take time and they need to be fully convinced about how it is used.

As much as recent history teaches us that people are willing to reap the rewards of the value exchange, for Open Banking to be a success it’s important to remember that attitudes to data sharing vary greatly. By understanding and acting upon that, there can be successes for us all.

Chris Robertson, Director at HD Decisions, a part of Experian