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Open Banking

Open Banking in a nutshell​

Open banking allows third-party financial service providers, such as Fliqa, the possibility to access, use and share customer financial data or initiate payments through a standardised and secure API with their banks or other financial institutions.

This means that customers can give third-party providers permission to initiate a payment or access their bank account information (balances, transactions ...).

A simplified overview of how it works​

The process starts with the customer. When a customer wants to use open banking services, they must give explicit consent for their bank to share their financial data or initiate a payment on their behalf. This consent is usually provided through a secure authentication process, such as a password, fingerprint, or two-factor authentication.

APIs (Application Programming Interfaces)​

Banks and financial institutions use a technology called APIs to securely share customer data. APIs act as intermediaries that allow different software systems to communicate with each other. In the context of open banking, these APIs enable the sharing of financial information or executing payment transactions.

Data Sharing​

Once the customer provides consent, their bank securely shares specific financial data, such as account balances, transaction history, or payment information, with the authorized third-party provider. This provider could be a financial app, a fintech company, or another bank.

Data Usage​

The authorized third-party provider uses the shared data to offer various services to the customer. These services can include budgeting apps, investment tools, loan approvals, or payment initiation services. The provider may also analyze the data to offer personalized financial advice.

Security and Regulation​

Open banking systems are heavily regulated to ensure the security and privacy of customer data. Banks and third-party providers must adhere to strict security standards and follow legal requirements to protect customer information. Encryption, access controls, and audit trails are used to safeguard data.

Customer Control​

Customers maintain control over their data throughout the process. They can revoke consent at any time, limiting or stopping the sharing of their financial information. They can also specify which data is shared and with whom.