Use cases will underpin success for an open data future
Australia and New Zealand share a love of rugby, cricket, and pavlova.
In 2024, the local team at Envestnet® | Yodlee® is looking forward to open banking being added to the list.
We’re excited for New Zealand to turn on its industry-led version of open banking when the four largest banks – ANZ, ASB, BNZ, Westpac – make payment initiation APIs available in May and account information APIs available in November.
This will deliver 80% coverage1 of New Zealand bank customers and there will be more when Kiwibank comes online in 2026.
Additionally, we are also eagerly awaiting a regulatory-led boost when the Customer and Product Data (“CaPD”) bill2 is legislated, designating banking as its first sector. When established, the statutory regime will remove the current requirement for bilateral contractual agreements and replace it with a more streamlined regulatory framework.
It’s going to be a big year!
So, how can banks, lenders, fintechs, and others take advantage of the open banking opportunity as data recipients?
Based on Envestnet | Yodlee’s experience in Australia and globally, a key first step to open banking success is focusing on your use case and the associated customer value proposition.
Classic use cases
There are “tried and tested” open banking use cases, for example, account aggregation, personal financial management (saving and budgeting), personal lending, and mortgages.
Open banking can power micro-investing round-ups and help share market investors to stay on top of their portfolios.
There are SMB use cases, too, to make it easier for business owners to handle their financial admin and gain better visibility on cash flows.
Intersections with regtech and proptech
We’re excited about intersections with regtech, such as account verification to help with proof of digital identity and also to prevent payments fraud.
There are also crossovers with proptech, for example, helping tenants to prove their bona fides to a new landlord or to be nurtured to achieve a savings goal for a home loan deposit.
Adding value with digital connection and data analytics
The core customer value proposition of open banking is that it offers greater convenience, control, confidence, and choice.
The most exciting use cases are focused on adding value to transactional bank data to surface insights around, for example, switching to a better deal or tracking financial wellness.
An additional element of value is the way open banking connects customers into a more inclusive and digitally advanced financial ecosystem. In the future, assuming non-banks, utilities, telco and health are also brought into the CaPD regime, there will be additional datasets available to data recipients.
Today’s open banking solutions could be tomorrow’s “super apps,” expanding to span multiple sectors, and further integrating digital services into everyday life.
An exciting time for financial innovation in Aotearoa
With so much opportunity in open banking, it can be hard to know where and how to start.
If you’d like some help, please reach out to our team.
Around the world, Envestnet | Yodlee powers a large depth and breadth of use cases and value-added solutions. We’d love to help you make yours a success.
Sources
- interest.co.nz, https://www.interest.co.nz/banking/125267/payments-nz-ceo-steve-wiggins-says-nz-not-behind-other-countries-open-banking-due
- FinTechNZ, https://fintechnz.org.nz/2024/02/08/a-deep-dive-into-the-customer-and-product-data-bill/
