Global Open Banking Market Size 2023: Trends, Competitive Analysis And Forecast 2028


(MENAFN- IMARC Group)

IMARC Group's report titled“ Open Banking Market: Global Industry Trends, Share, Size, Growth, Opportunity and Forecast 2023-2028 “. The global open banking market size reached US$ 21.3 Billion in 2022. Looking forward, IMARC Group expects the market to reach US$ 67.8 Billion by 2028, exhibiting a growth rate (CAGR) of 20% during 2023-2028.

Factors Affecting the Growth of the Open Banking Industry:

. Regulatory Initiatives:

Regulatory mandates, exemplified by the European Union's Payment Services Directive 2 (PSD2), serve as a significant driver for the global open banking market. These regulations require financial institutions to open their application programming interfaces (APIs) and share customer data securely with authorized third-party providers. By fostering data sharing and interoperability, these initiatives promote competition and innovation within the financial sector. Financial institutions are compelled to adapt and integrate open banking solutions to comply with these legal requirements while simultaneously leveraging the opportunity to offer new, customer-centric financial services. The regulatory push underpins the accelerated adoption of open banking, making it a strategic focus for market research and consulting services.

. Demand for Personalized Financial Services:

In an era where consumers and businesses seek personalized and convenient financial solutions, open banking emerges as a key enabler. Open banking services facilitate easy access to a wide array of financial products and enable seamless integration of multiple accounts and services. This enhances the overall banking experience, catering to the growing demand for tailored financial offerings. Consumers now expect highly customizable, digitally accessible, and user-friendly financial services. Open banking aligns perfectly with this demand, driving financial institutions to embrace it to meet customer expectations and remain competitive in the evolving financial landscape.

. Fintech Disruption:

The rise of fintech startups and digital-native banks disrupts the traditional financial industry by challenging established players. These agile and innovative fintech companies leverage open banking to provide cutting-edge financial services, from peer-to-peer payments to robo-advisors and digital wallets. As fintechs gain ground and attract a growing customer base, established financial institutions are increasingly pressured to embrace open banking as a strategy to remain competitive and relevant. These dynamic forces traditional banks to adapt, innovate, and explore partnerships with fintech companies to harness the potential of open banking and secure their position in the rapidly evolving digital finance landscape.

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Leading Companies Operating in the
Global
Open Banking Industry:

  • Banco Bilbao Vizcaya Argentaria S.A.
  • Clarity Group Inc.
  • Credit Agricole (SAS Rue La Boétie)
  • Finastra (Misys International Limited)
  • Finleap connect
  • Jack Henry & Associates Inc
  • Mambu
  • NCR Corporation
  • Nordigen Solution
  • Revolut Ltd
  • Riskonnect Inc.
  • Societe Generale.

Open Banking Market Report Segmentation:

By Services:

  • Banking and Capital Markets
  • Payments
  • Digital Currencies
  • Value Added Services

Banking and capital markets represented the leading segment due to its integral role in the financial industry and the extensive use of open banking services for improved financial management.

By Deployment:

  • Cloud-based
  • On-premises

On-premises accounted for the largest market share owing to the need for robust security and control over sensitive financial data, making it a preferred choice for financial institutions.

By Distribution Channel:

  • Bank Channels
  • App Markets
  • Distributors
  • Aggregators

App markets represented the largest segment as it offers convenient access to open banking services, facilitating seamless transactions and financial management for consumers and businesses.

Regional Insights:

  • North America (United States, Canada)
  • Asia Pacific (China, Japan, India, South Korea, Australia, Indonesia, Others)
  • Europe (Germany, France, United Kingdom, Italy, Spain, Russia, Others)
  • Latin America (Brazil, Mexico, Others)
  • Middle East and Africa

Europe's dominance in the open banking market is attributed to its progressive regulatory environment, fostering innovation and competition among financial institutions while ensuring data security and consumer protection.

Global Open Banking Market Trends:

The global open banking market is primarily driven by regulatory initiatives aimed at promoting competition and innovation in the financial sector that creates a favorable environment for open banking adoption. Regulations like the European Union's PSD2 and similar initiatives worldwide are compelling banks to open their APIs, enabling third-party providers to offer innovative financial services.

Apart from this, the rising demand for personalized and convenient financial solutions that push consumers and businesses to seek open banking services is another major growth-inducing factor. These services offer easy access to a wide range of financial products and allow for seamless integration of multiple accounts and services, enhancing the overall banking experience. Furthermore, the rise of fintech startups and digital-native banks is fostering competition and driving traditional financial institutions to embrace open banking as a means to remain competitive and relevant in the digital era, thus supporting market growth.

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