If you’re a fintech planning to bring your app to Ireland; or an Irish provider considering integrating open banking into your product, this blog is for you.
We spoke to Olivia and Irish Life about the reliability of bank APIs, how receptive the market has been and lessons learned while launching one of the first open banking apps in Ireland.
PSD2 set in motion a wave of open banking initiatives across Europe, requiring banks to open up their financial data to third party providers.
In late 2018, Irish bank AIB launched its first APIs and in 2019 other Irish banks followed. This year has seen the launch of the first open banking powered services in Ireland and initial demand has been high.
TrueLayer went live with our Ireland APIs in June, covering 95% of the Irish banking population, with connections to banks including Bank of Ireland, AIB, Ulster Bank, permanent tsb and Revolut.
One of our first customers there, Olivia, is a free AI-powered savings app that helps users to stay informed, spend smarter and save more. Olivia has just completed a 3-month pilot in Ireland with launch partner Irish Life and TrueLayer.
This is what the team learned.
1. Don’t underestimate PSD2 compliance effort
Olivia first launched in the US, before taking its app to Brazil and then Ireland. Getting compliant with PSD2 regulations shouldn’t be underestimated, says Firas Said, Director for Olivia AI – Europe.
“We couldn’t present people’s data back to them without being regulated or without registering as an agent of TrueLayer, which we ended up doing,” explains Firas.
“We rely on machine learning to train our transaction categoriser, and since it took a while for us to get access to data, we had to find innovative ways to train the categoriser before launch. It required significant compliance effort to put Olivia in people’s hands, but TrueLayer helped us – and I’m thankful that everything is now in place.”
2. App to app connectivity is key
When it comes to authenticating a bank account, mobile experience is best. 99% of users in Ireland that connect through TrueLayer’s API, do so on their mobile device. Once app to app is enabled, 33% more users complete the authentication process, explains Matt Parish, Product Manager for TrueLayer.
“App to app means consumers can use fast biometric authentication, instead of online banking flows which can require multiple passwords. The Irish regulator is in favour of a great user experience for customers – we understand that they have asked banks to remove all obstacles by the end of the year, which should include implementing app to app. This will be hugely important for the success of open banking in Ireland.”
3. Banks need to work on reliability
Open banking is new in Ireland, so there has naturally been teething problems, reports Firas Said.
“With some banks we had little to no issues,” he explains, “with others we had some very significant issues, including a month-long period of unexpected downtime, as well as one bank nullifying our user consents over a weekend.”
Things are improving, adds Rosalie Dowding, Product Operations Manager at TrueLayer. “At first, some banks were unable to cope with the sudden increase in volume of connection requests, but now we’re a few months down the line, we’ve seen error rates decrease by 30% even while volumes are increasing by 40% every month – and the connections are looking more stable.”
TrueLayer’s Matt Parish adds: “This isn’t necessarily about reducing latency or managing technical implementation details. What we need is that when a user wants to access their data, they can, for the full period of that consent. Thankfully, we’re already seeing changes being made by the major banks to improve reliability.”
4. More data, please
Under current guidance, Irish banks must give regulated third parties access to at least three months of transaction data, but Olivia’s Firas Said hopes they will start to offer more.
“The more data that is available, the more value users will get,” says Firas, “since we’ll be able to generate deeper financial insights for them. Ideally, we’d like to see two years of data become the norm.”
And it’s not just historical data that would help, he adds. “Making non-transaction accounts available would be a big step forward. It’s not required by PSD2, but many of our users have asked us why savings accounts, for example, don’t show up. This is a real blocker if they’re trying to understand their overall financial picture. I hope to see broader financial datasets being made available, as has been talked about with open finance in the UK.”
Finally, simply making sure the account holder name is returned in all APIs would be useful, says TrueLayer’s Matt Parish: “That way we can help to verify account ownership – which we already do for a lot of our clients in the UK.”
5. Think ahead with 90-day re-authentication
PSD2 requires users to provide credentials to their bank every 90 days if they want to keep accessing their accounts through open banking apps.
Olivia starts reminding its users 30 days before a bank connection is due to expire, giving users the option to re-authenticate or get reminded later. “We make those messages progressively more urgent,” Firas explains.
In the UK, there are ongoing discussions about the 90 day limit, with many businesses feeding back that the window causes customers to drop off.
Paddy McHugh, Digital Product Manager at Irish Life says it’s time to start pushing for changes now: “The 90-day reauthorisation window is a big friction point for users. Let’s not wait for PSD3 to come about: let’s push now for a better experience, so we can give our users access to at least two years worth of data across all their accounts – and they don’t need to reauthorise every 90 days.”
Despite the challenges of launching on new bank APIs, the Olivia app has been warmly received, report Firas and Paddy.
“Our users love being able to access their data and find everything in one place,” says Firas, “along with the AI-driven features which help them spend smarter and save more.”
Paddy adds: “We were worried that since open banking isn’t well-known in Ireland, people might get nervous connecting their bank accounts, but the feedback has been fantastic.”
So what’s next for the smart savings app in Ireland?
“This is really just the beginning,” says Firas. “We’re looking forward to putting Olivia in the hands of many more users and adding new functionality.”
The team has just launched Olivia Social, where users can crowdsource savings wisdom. “We’re also excited to work on things like aggregating demand so we can source great deals for our users, as well as helping users to micro-invest their savings,” adds Firas.
As for TrueLayer, we’re extending our connectivity in Ireland to banks and fintechs like N26, TransferWise, An Post and KBC Bank, and helping our clients to offer instant bank payments.
With payments and data both powered by open banking, there is a huge opportunity to drive more value for consumers, says Matt Parish. “Imagine being able to automatically allocate money from a current account into a savings, pension or investment account, based on where the money is best put to use. This will be playing the whole orchestra of open banking and in five years, could be one of the big things that open banking does for consumers.”