11% of Credit Unions now offer open banking payment option

New findings show that adoption rates of Open Banking payments are increasing, with 11% of credit unions now offering this type of payment for financial services products.

The report by Access Group, highlighted the importance of providing customers with a range of options, including Open Banking, to meet their evolving expectations.

Since its launch in 2018, the adoption of Open Banking payments has also grown among fintechs, lenders, and building societies, with 58%, 42%, and 17% of these businesses respectively listing it on their websites.

However, the survey of consumers revealed a mixed picture when it comes to adoption and attitudes towards Open Banking payments, also known as pay-by-bank.

Just over a third (34%) currently use it to make payments in financial services, while 22% would like to do so in the future. Meanwhile, around 16% haven’t used it and are reluctant to and 13% said they’d never use it, while 15% were unsure.

The research also found that Open Banking payments are most likely to be used by younger demographics – with nearly half of 25-34-year-olds, and 37% of 18 to 24-year-olds, using it to make payments.

However, over one in four of the over-55s category have used Open Banking to make payments, and a further 17% are interested in using it to make future payments.

Commenting on the research, Giulio Montemagno, managing director of Access PaySuite, said “Digital payment methods are more popular than ever, but financial services must evolve to meet all customer needs. Offering a variety of quick, frictionless payment options is crucial. While Open Banking adoption is on the rise, there is a significant need to educate consumers about its benefits and alleviate their concerns.

“Some customers feel their current financial services do not meet their payment expectations. This highlights a clear opportunity for innovation in the industry to address these gaps and adapt to evolving consumer demands. This shift not only enhances customer experience but also drives the industry towards a more inclusive and efficient future.

“Aside from this, the benefits of offering multiple payment methods for merchants, at both a local and international level, are undeniable. By enabling seamless access to financial data and services across different banking organisations, Open Banking invites businesses to reap the rewards of cross-border payments, additional revenue streams and wider potential customer reach.”