The new year heralds a new era in the financial services industry with the introduction of Open Banking.
While some concerns have been aired around this innovation and how it will work in terms of the new General Data Protection Regulation and cyber security, we believe that the focus on customer choice in banking that this ushers in will increase as the year progresses, a move we welcome.
Following its retail banking investigation, the Competition and Markets Authority (CMA) concluded that older and larger banks do not have to compete hard enough for customers’ business.
Nine of the bigger banks adopted new Open Banking rules on 13th January, enabling customers to give consent to allow businesses – other than their bank – to access their current account information.
In addition, after a year of discussion and debate, international regulators have finally announced the finalised Basel III banking reforms, which intend to boost banking competition by levelling the playing field in terms of the capital requirements banks must hold, which will hopefully make it easier for smaller banks to compete in certain areas of lending when they come into effect from 2022.
These reforms will help increase innovation and competition in the banking sector. While the results of these changes will emerge over time, we are already factoring in the implications of these changes into our plans for products and services at Hampshire Trust Bank.
We believe it is vital for people to have easy access to a wider range of financial services, tailored more closely to their circumstances and requirements. At Hampshire Trust Bank, we pride ourselves on employing experts in the SME sectors in which we operate.
The CMA identified that “there is a particular problem in SME banking where many SMEs open their business current accounts at the same bank where they have their personal current accounts, then stick with that bank for their business loans”.
Our recent SME Growth Watch research found that SMEs in the top 10 cities in the UK are forecast to contribute £241bn to the economy by 2025, a 19% increase from the £202bn contributed in 2016. In order for SMEs to achieve their growth potential, they need more support, including greater financial support from a wider range of providers.
We believe that increasing customer choice in banking is key to helping UK SMEs to grow, in turn helping to drive the economy forward, which is good news all round.
SIGN UP TO OUR NEWSLETTER TO RECEIVE MORE NEWS LIKE THIS STORY
Development Bank of Wales provides £500,000 to IT repairs business
Comtek Network Systems UK Limited has secured £500,000 of investment from the Development Bank of Wales
Wesleyan Bank names new director
Wesleyan Bank has strengthened its management team with the appointment of Simon Welling (pictured above) as its director of sales and marketing.
Cash Isa savers missing out on transfer market
Half of cash Isa savers aged 55-plus (50%) have never moved their accounts to another provider, according to a new study.
CivilisedBank secures further funding
CivilisedBank is set to receive further funding from current investor Warwick Capital Partners, subject to regulatory approval.
A round-up of the latest specialist banking products
With the continuing expansion of the specialist banking market, this year promises to bring a host of new products and services to the sector.
Hanley Economic BS rebrands
Hanley Economic Building Society has rebranded as it launches its first ever TV advertising campaign.
Lydia raises a further €13m
Lydia has announced that it has raised a further €13m, taking the total amount raised by the French fintech start-up to over €23m.
Fintech as a force for good
The big news around fintech focuses on the many ways it is already making financial services more profitable, more scalable, more secure and more user-friendly.
FIBA commits to 30 events
The Financial Intermediary & Broker Association (FIBA) has announced 30 regional meetings for its members and intermediaries interested in joining the Association.
20% of brands to abandon their mobile apps by 2019
A fifth of brands will abandon their mobile apps by 2019 due to a lack of adoption and customer engagement, according to a study by research and advisory company Gartner.