Open banking is the key to unlocking the potential for more tech innovation within the UK

Although the benefits of new technologies may not be obvious at first, innovation always brings about growth. Andrew Griffiths writes about how open banking is an example of how government is building their strategy

We live in an age that is rapidly changing technologically, with new ideas popping up all the time. However, this change is not just a result of technology. It’s driven by entrepreneurs who want to disrupt the status quo and bring new products or ideas to market.

This government wants to encourage the entrepreneurial spirit. It wants to unlock the potential technological advances it can bring every town and city, as well as to grow the economy. Rishi Sunak, during his tenure as advisor, stated that embracing technological changes is one of the pillars for our financial services strategy.

As the late Steve Jobs once said: “Innovation distinguishes between a leader and a follower.” And he was right. Apple has always supported technological change, allowing people to connect anywhere, anytime, with anyone, anyplace in the world. In her fall statement, she vowed to reform EU-derived laws that have hampered us in five exciting industries.

These plans include reforming our financial service regulatory framework – which was announced last year as part of the Edinburgh Reforms. We will be revising the rules that govern digital technology and life sciences, as well as advanced manufacturing.

If you’re wondering if it’s possible, look at the phenomenal success of fintech here in the UK. The sector supports thousands of jobs and has flourishing clusters in Cardiff. Manchester, Cardiff, Belfast, Edinburgh, and Manchester. Despite economic difficulties, the sector continues its success in attracting more investment to the UK that the next 10 European countries. It ranks second globally after the US, where I spent the past week encouraging more state capital to flow into UK-based companies. .

Open banking, a relatively recent technology, is used by a large percentage of UK’s fintech sector. It is a great example showing the hidden benefits of new technologies. If you access multiple accounts you have with different financial institutions—like a bank—in one app, you’re probably already using open banking technology. It is estimated that 6.55million people in the UK use open banking technology. Research shows that 69 percent of people who use technology find it easier to track spending — and 55 percent of people find it easier to budget.

The technology also allows for fast, reliable and low-cost payments. This allows businesses to pay immediately and save money. They can be a cheaper and more competitive alternative to card plans in certain cases. In the UK, Open Banking was used to make 7.5 million payments in December, an increase of 230 percent over the previous year. There are more than 200 UK open banking providers, more five times as many than the nearest European competitor. Over 600,000 SMEs use technology to improve their businesses.

Without the efforts of the Open Banking Implementation Authority (which last week confirmed compliance with the Competition and Markets Authority’s roadmap), none of this progress would be possible. It is also important that we acknowledge the contribution of British banks who have funded, supported and invested in the work.

My task now is to not only maintain this progress but to build on it in order to ensure that the UK’s open banking technology and wider innovation benefits are felt by as many people, businesses, and businesses as possible. As the Prime Minister said in his New Years address, we must change the way that our country operates and raise our aspirations to create a more innovative economy that provides better paying jobs.