News & Views - Savantor

Open banking – the next evolution?

Wednesday, 16 August 2017

Figures recently released by UK Finance continue to demonstrate the decrease in popularity in the use of cash, with the number of people using cash to pay for everyday purchases in the UK declining by 11% over the past year as growth in the use of contactless cards accelerated.

The downwards trend for cash is in contrast to monthly figures released earlier this week by UK Finance which show 143% growth in contactless payments in June, with consumers continuing to use their cards for lower value purchases.

Nevertheless, despite the decline, cash was still used 25% more often than the second most frequently- used method of debit cards. Whilst the number of cash payments is forecast to decrease by 43% over the next decade with the total value predicted to fall by 23% by 2026, the Chief Economist of UK Finance does not believe that the UK is on the verge of becoming cashless in the near future as, “People will always want to choose the payment methods that best suit them and, for the foreseeable future, in lots of cases that will continue to be cash.”

This preference for cash extends to savings as well. Even though interest rates are at an all-time low, delivering minimal and derisory returns, there is a strong desire amongst UK savers to maintain their funds in cash instead of investing in shares and bonds.

One of the technological developments evolving in the banking market is open banking, which enables savers to choose accounts from many banks and even from many countries using just one overriding account. A company called Deposit Solutions offers an online open banking solution which is already operating in Germany, both as an online product in its own right (called Zinspilot) and via Deutsche Bank.

The service is due to be launched in Britain within the next 12 months.

There are multiple benefits of such a service; for the consumer, not only is everything more convenient with it being easier to both select the best accounts to use and to move money around accounts for the best interest rates, it will also be easier to keep within the FSCS limits for saving with one particular institution. For the underlying banks, it is likely to achieve a reduction in servicing costs per user as it will provide access to savers’ funds without having to either actively attract new savers.

All of the UK’s big banks are apparently considering open banking, either using a service such as Deposit Solutions or developing their own solution. It will be interesting to see how this service evolves over the next few years and whether it is embraced by UK savers.

Savantor Services

Savantor Services

Savantor services are tailored to Client needs based on our core service areas

Specialist Resourcing Payments Strategy Platform Transition Operational Efficiency
Savantor Services

Job Opportunities

Consulting and contracting roles in the payments, mobile and banking arena within the UK and across Europe

View more
Savantor Services

Savantor Views

Find out more from our Savantor brochures, MarketEye back copies and Industry opinion

Collateral Market Eye News & Views Sign Up to receive MarketEye

Client Quotes

Payment Specialists

"Working close with Savantor's professionals over the years in the payment arena. I appreciate the skills and knowledge these guys have and will surely engage with them when opportunities arise. The current engagement with Savantor is full to satisfaction and beyond."

Idsert Walta, Head of Banking Categories - Nordea - Scandinavia

Interchange Review

"Savantor did a superb job in confirming what we believed was an area of weakness. The detail we now have will enable us to agree internally what we need to do to improve structure, control and income. Nationwide management were very impressed with the quality of the Savantor team."

Adam Slater, Senior Manager - Banking - Nationwide Building Society - UK

Market Insights

"Savantor did a good job in helping us understand the dynamics of a key growth area for Trionis. Savantor's ability to listen and their degree of commitment have always impressed me. They have been of great help in providing us important market insights and I would not hesitate to work with them again in future."

Ernst Verbeek, Managing Director - Trionis - Belgium

Expert Witness

"After searching extensively for the required industry expert in a complex litigation, Savantor was identified to have the necessary industry knowledge and expertise on a range of complex issues. Savantor provided clear advice and was able to quickly hone in on the key issues, but most importantly, generating pragmatic winnable answers."

Gavin Ingram, General Counsel & VP Strategic Planning - Global Blue - Asia Pacific

Moneris Solutions

"Savantor did an outstanding job of the review and I received nothing but positive feedback on the interaction with our management team."

Jeff Guthri, COO - Moneris Solutions - Canada

Acquirer Risk Assessment

"The expertise provided by Savantor has greatly helped us evaluate our risk position and to take the right steps in managing our future risks. Strong, disciplined planning and an ongoing willingness to work closely with our staff played an enormous part in making this a very successful well-delivered project which will greatly help us in achieving our business goals."

Mark Healy, Chief Risk Officer - NEOVIA Financial - UK

Card Migration

"I was impressed by the speed with which the Savantor team were able to start delivering and as a team they have made a significant contribution to the success of the Programme."

Bjorn Niels, Programme Director - ABN AMRO Bank - The Netherland

Acquirer Transformation

"We needed a programme manager for a complex transformation who also brought a broad understanding to help stakeholders through the change. We have been delighted with the delivery and outcomes from this engagement with Savantor."

Michael Liquornik, Executive Vice President - Neovia Financial - UK

Clients - Request Support

Send us a support request and one of our specialists will be in contact to assist you.

Consultants – Upload your CV

Register your CV with us and gain access to a range of job opportunities through our online job search portal.