Open Banking Stimulating NZ Economy

Open banking is stimulating the New Zealand economy as the finance market is growing and maturing, FinTechNZ executive director Jason Roberts says.

Open banking connects banks, third-parties and technical providers, enabling them to exchange data simply and securely to their customers’ benefit.

FinTechNZ can provide support for people and organisations, so they can deliver better value and create innovative services.

Kiwi fintech companies are seeing value overseas and there have been a string of exemplars over the last month, Roberts says.

“Fintechs are no longer necessarily seen as overt challengers, competitors to be wary of, but to partner and work with for overall best customer value.

“It is a sign of growing maturity but still needs more catalysts to accelerate the market at pace as we are seeing overseas. This is the case especially in markets where the concept of customer data right is either regulated as in the UK and Australia.

“The tech and finance sectors are driving this in response to customer demand for better services, great value and easier digital experience.

“Building consumer trust is critical for any business. Fintech’s tend to excel here in that they are all living in the latest digital platforms, are easy to engage with, easy to onboard and quickly deepen consumer trust through good digital experiences, slick graphics and conversational marketing.

“They also tend to be single point product and a very clear proposition or value consumers can easily grasp

“We have seen some excellent examples of this with share/investment platforms like Sharesies, Hatch and Kernel.”

The impact of open banking has been significant overseas where new developments in the marketplace have been stimulated by government regulation.

“In the UK, Kiwi companies are generating success such as 9 Spokes and Xero bookmarking both ends of the app provider marketplaces and who would no doubt be keen to see the same legislation shaped for New Zealand.

In the UK there are 700 providers, many are fintechs, now estimated to be used about 10 percent of UK consumers, generating around 30 million payments a year, growing at 10 percent month on month.

Roberts says it is a snowball effect Kiwis can anticipate in NZ once proposed legislation is enacted

“The impact on fintechs is already on the rise in Aotearoa despite open banking legislation still in development and the positive news is the number of fintechs either providing outright new or innovative services, but also the partnering. Examples include Dosh, BlinkPay and Tella.”

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