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UK open banking has delivered a functioning ecosystem, but its growth remains incremental, leaving regulators and firms focused on open finance and the next phase of payments reform.
January 2026 marks eight years since the launch of open banking in the UK, a milestone Open Banking Limited (OBL) has framed as evidence of lasting structural change in the financial system.
In announcing the anniversary, OBL described open banking as having evolved from a regulatory initiative into a core component of the UK’s financial infrastructure, supporting innovation across payments, lending and money management.
The scale of the ecosystem is now difficult to dismiss. According to OBL, more than 16.5m user connections are live across the UK, nearly 5,000 skilled digital jobs have been created since 2018, and open banking payments reached close to 33m in November 2025 alone.
Henk van Hulle, OBL’s chief executive, said in a statement that open banking has grown into an “ecosystem that people and businesses across the UK now use as part of everyday financial life, sometimes without even realising.”
The UK’s role as a pioneer is also widely acknowledged. Through the Competition and Markets Authority’s (CMA) Retail Banking Market Investigation Order, the UK delivered one of the first mandatory open banking regimes globally, complete with common technical standards, regulated third-party access and a central implementation entity.
Compared with many jurisdictions, the UK succeeded in building stable and secure API infrastructure at scale, and did so quickly.
However, eight years on, the impact of open banking has been more measured than many early advocates anticipated.
Although adoption has grown steadily, account-to-account (A2A) payments have not displaced cards in any meaningful way, nor has open banking fundamentally reshaped mainstream consumer payment behaviour.
Much of its use remains embedded in specific journeys such as onboarding, affordability checks and account verification, rather than operating as a visible alternative payment method.
Ultimately, the UK’s open banking framework has proven its value as regulated infrastructure but has not yet delivered the kind of market-led disruption once forecast.
Incremental change and enduring policy ambition
For payments firms and compliance teams, this distinction matters. After eight years, the significance of open banking lies less in what it has replaced and more in what it has established as acceptable regulatory practice.
The UK’s open banking regime requires banks to have APIs that allow for the sharing of customer data (with consent). It also imposes common standards across competing firms and requires regulators to oversee complex multi-party ecosystems in pursuit of competition and innovation.
That approach has since become a reference point for the UK’s wider Smart Data agenda and increasingly informs policy thinking well beyond current accounts.
Open banking also remains strategically important to policymakers, even if its commercial impact has been limited to date.
Regulators continue to view A2A payments as a potential counterweight to international card schemes and as a means of improving resilience, lowering costs and strengthening domestic control over critical payments infrastructure. The fact that consumer behaviour has not shifted dramatically has not weakened that underlying policy objective.
One area where open banking has clearly strengthened its regulatory credentials is fraud. In its latest financial crime update, published in December 2025, OBL reported a downward trend in both the volume and value of open banking fraud.
In the first half of 2025, open banking-initiated payment fraud accounted for just 0.013 percent of transactions by volume, compared with 0.045 percent across the wider payments industry.
For regulators, these figures matter. Strong fraud performance reduces the perceived risk of expanding open banking use cases and weakens arguments that innovation in this area must be constrained on safety grounds.
For firms, it signals that fraud concerns are unlikely to provide cover for slow adoption or limited engagement in future regulatory discussions.
As van Hulle noted, the UK has created something “genuinely world-leading”. The question now is how that advantage is protected and extended.
The shift from build phase to market outcomes
That question sits squarely at the centre of the Financial Conduct Authority’s (FCA) current payments agenda. Open banking and its evolution into open finance are no longer treated as experimental or peripheral policy areas, but as foundational elements of the UK’s future financial architecture.
In December 2025, the FCA published its report on commercial variable recurring payments (cVRPs), announced plans to establish the UK Payments Initiative (UKPI) and launched a dedicated open banking and open finance webpage.
Taken together, these steps signal that the regulator is intent on moving beyond basic connectivity and towards commercially sustainable models that deliver tangible consumer and business benefits.
The emphasis is shifting from whether firms are technically capable of participating in open banking to whether the framework is being used effectively. cVRPs, in particular, are emerging as a test of whether open banking can support scalable payment use cases without relying solely on regulatory mandates.
This direction of travel is reinforced by the FCA’s December 2025 letter to the prime minister, which outlined the regulator’s 2025 progress and 2026 priorities across payments.
Variable recurring payments, contactless reform, open finance and sterling-backed stablecoins were all positioned within an ambitious growth agenda, underlining the FCA’s intention to align data sharing, payments innovation and digital assets within a coherent regulatory framework.
For payments compliance specialists, the implications are significant. Open banking can no longer be approached as a one-off compliance exercise or a completed implementation project.
As open finance expands the range of data and products in scope, firms should expect closer scrutiny of governance arrangements, consent management, third-party risk and consumer outcomes.
Eight years after launch, open banking is no longer about proving that regulated data sharing can work. The harder task now is demonstrating that it can deliver sustainable, market-wide value.
For firms operating in the UK payments space, the next phase will test not just technical compliance, but strategic engagement with a regulatory agenda that is still very much in motion.
