Overcoming Data Silos with Open Banking

Retail banking has traditionally been a slow-moving, complex yet robust system. However, modern customers, especially those under thirty, expect speed and simplicity. Challenger banks are doing a good job at meeting these expectations, as well as being agile enough to keep rolling out new products. For this reason, retail banks are playing catch-up by reinventing themselves and it’s the open banking initiative which is driving this. Take for example the issue with data silos. In traditional banks information is often stuck in specific departments meaning that a consumer has to start a process from the beginning every time they need to deal with a different area of personal finance. Whether they are applying for a new account, a loan or a mortgage, each product requires a lengthy process of identity verification, proof of address and other checks. 

These data silos are usually the result of legacy technology systems, lots of manual processes running alongside them and multiple departments being involved. A customer is also often expected to visit a branch multiple times with limited functionality available online. The data accessibility offered by open banking gives traditional financial institutions the opportunity to partner with fintechs, vastly modernising their systems and improving the way in which they deliver their products and services to consumers. 

Introducing open banking powered services means processes can be completed online, quickly, securely and efficiently. It means one customer service representative or even a chatbot can handle and find solutions to enquiries normally involving multiple departments. The issue of multiple departments should not be underestimated. Communication silos are also a problem within complex businesses like retail banks. Add to that the problem of differing skillsets or an issue with training and having many bank employees involved in handling one process can lead to a less than efficient customer journey. 

Making these changes isn’t just a matter of technology and innovation. It also requires a shift in organisational culture, with the values, symbols and language within a bank all conveying a modern, tech-forward approach. Bank employees, no matter what their experience or age need to feel engaged for it to be a success. This isn’t about using clever jargon, or scaring employees with an instant overhaul. It’s about getting everyone on board with proper change management and two-way communication. Silos are becoming a thing of the past but there’s still a lot of work to be done.