Open Banking is a new government-sponsored initiative designed to improve financial services for consumers and to increase competition between service providers.
It gives consumers, control over the information relating to your financial position, held by your bank, banks or similar service providers. It means you can give third parties access to that information, for a variety of purposes you approve of.
A typical example might be allowing a service provider to access your accounts held with several banks, so that they can then allow you to see a total picture, in one place, of all your banking-related financial dealings.
Cubefunder uses Open Banking to make it simple to share your banking information. Instead of requiring PDFs of your bank statements, we use consent.online instead. This makes the processing of your loan application faster so you can get a decision within 48 hours.
A company like consents.online may ask for your authorisation to access your bank account information.
Once you have provided your authorisation, they will be able to see specified details of your banking status. They will be able to see things such as your bank statements or card transactions etc.
No company can access the information at your bank unless you have given them your permission to do so.
Currently, companies offering such services are may or may not be authorised by the Financial Conduct Authority (FCA) or their European equivalent. Making sure you only allowed FCA authorised firms to access your account information may offer you a layer of protection provided by the FCA.
You can check whether a provider is authorised by looking them up online through the open banking organisation or FCA.
You have complete control over who is able to look at your financial information held at your bank. Your bank will not operate on the basis of allowing global access or provide such access to a company that has not been explicitly authorised by you for such access.
You can use open banking on any bank account held which is accessible via e-banking facilities through the internet to your PC or smartphone.
That includes personal and business current accounts, online electronic money accounts and credit cards.
The default position is that you are not offering open banking to external parties unless you have authorised it on a provider-by-provider basis.
In situations where you have given a company permission, you can easily withdraw permission.
No. Nobody can make a payment from your bank to anyone else without your express advance authorisation.
Please also see the question below relating to unauthorised payments.
No, Open Banking will have no impact on your credit score.
Open Banking and the potential it offers for consolidation and smart systems assisting you in decision-making, may help you to take steps to improve your credit scoring over time.
The government’s regulations require your bank to be responsible for any fraudulent transactions registered by an open banking services provider.
Your bank must refund you immediately, unless they have grounds to suspect fraud or negligence. If the third-party was at fault, the bank can recover the funds from them.
Consents Online is a FCA regulated service provider maintaining a central repository of information relating to who you have authorised to access your accounts under the Open Banking initiative. That permits you to manage those authorisations in one place and at the click of a button.
The service is entirely free.
Open Banking is entirely free of charge in terms of your bank making the access available to authorised third parties.
Note though that some providers of Open Banking products and services which propose benefits to you will, of course, in some cases have a charge associated with their provision of services.
As with any complaint situation, it typically makes sense to discuss your concerns in the first instance with the service provider or other party that you believe is behaving unreasonably or unacceptably.
If you are unable to obtain a resolution that is to your satisfaction, you should consider making a formal complaint to the Financial Ombudsman.