Introducing the quick, easy and secure way of transacting. Open banking is rapidly becoming the new standard for taking payments.
You've probably heard that it will revolutionise your customer experience and perhaps become a dominant form of transacting. This is partially true. However, we want to dig deeper.
What is so special about it?
Why is it gaining a lot of attraction?
How will it enhance my customer experience?
This article will answer your questions and clarify whether businesses should invest their time in open banking to grow.
So, what is Open Banking?
Open banking is a form of taking payments as a business. The transaction is processed through the customer's most trusted source- their bank.
The customer pays through their online banking either via their mobile banking app or web portal. This can sometimes be referred to as 'pay by bank'. The payments enter the business account directly from the customer's account, so no merchant processing is required.
The transaction is made through a few simple taps. Customers will no longer have to input account information like sort codes, account numbers, or any card details, avoiding human error. Instead, the customer is redirected to their online banking, where authentication and approval are required for the transaction to be processed.
What does the Future look like for Open Banking, and how will it impact Businesses?
We'd like to break it to you softly; if you think this will become your dominant form of transacting overnight- you're wrong.
It's not going to be as quick as that, it may take time, but the usability shown across Europe has positive progression. It could eventually become the main transaction method in the future.
PwC state that 64% of adults and 71% of SMEs are expected to adopt open banking by the end of 2022 in the UK, which is pretty significant.
It is evident that open banking is on the rise and has had a great response so far. We believe that the payment space is being transformed, and time and time again, we've seen that those who are late to the party don't always maximise the benefits.
What makes it so Revolutionary?
Open banking truly has a lot to offer which is probably why it's widely spoken about and on the rise, here's why:
If waiting a few days for your money to clear is challenging, this will be music to your ears. It's not next-day funding; it's far better! Instant funding is available when transacting through open banking. The payments are all real-time, and once a transaction is approved, it is settled into your business bank account. GAME CHANGER!
Enhances user experience
User experience is vital to any business, and we've all witnessed the correlation between having a smooth payment experience and growing your business. It effectively keeps your customers happy and translates into customer retention. Luckily, open banking allows a smooth payment experience with minimal effort.
Unlike card payments, online banking requires authentication for each payment to be approved, which means businesses utilising this method will experience fewer fraud cases.
Alongside reducing fraud, chargebacks are less concerning as open banking does not allow them, avoiding any reputational risk to your business.
Quick and easy to set up
Lastly, for those of you that are eager to get access to open banking, you're able to start taking payments on the same day!
Hopefully, we've answered a few of your questions, but if you'd like more information on how open banking can support your business, schedule a call with one of our Blink experts.
We are currently offering free opening banking transactions until 31st October 2022.