Debunking a payment myth: why open banking is ready for mainstream
Adoption of open banking payments is skyrocketing, yet some say they're not ready to go mainstream.
I want to share with you a few facts and data points which challenge the myth that consumers don’t trust or use open banking.At TrueLayer, we process more than half of the open banking volume in the UK — whether you measure it by API calls or by payment volume — giving us a unique perspective on this topic.We’ve found that:
- open banking payments typically reach 30% share of checkout within a few months of launch — and for some of our clients, it’s as high as 80%
- consumers paying with open banking typically deposit 30% more in value and three times more often than those using other methods
- the total value of open banking payments we’ve processed has increased by 250x in the last 12 months
- at the current rate of growth, 60% of the UK population will have tried open banking by September 2023
What are open banking payments?Open banking payments move money directly from the payer’s bank account to the seller’s bank account, without using a third party payment network (known as ‘Payment Initiation’). It has all the low cost and security benefits of traditional bank transfers, with better UX.Now let’s get to the main reason for this blog: why the idea that consumers don’t trust and won’t use open banking payments, is a myth. There are two important reasons:
- Consumers are not ‘loyal’ to payment methods: they care about convenience (and security).
- Take up of open banking payments isn’t low, it’s just not widely available yet.