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The Open Finance Association (OFA) is ready to finish the job the Payments Services Directive started and create a well functioning open finance ecosystem, the new not-for-profit organisation declared.
Payments success stories such as Worldpay, Plaid and TrueLayer have come together to launch a new trade association to ensure open banking and its successor, open finance, are a priority for Europe.
“Now is the time for industry, policymakers and regulators to come together and make open finance a reality,” said Nilixa Devlukia, who has taken on the role of chair.
Through the promotion of an API-focused agenda in both payments and data, the former regulator said that the OFA aims to promote a healthy and sustainable fintech ecosystem, in which consumers and businesses all benefit from improved, innovative services.
“I am excited to work with our members, who are true leaders and innovators and look forward to engaging with stakeholders at all levels to achieve OFA’s vision.”
The OFA, whose other members include GoCardless and Token, have set out three goals.
This includes completing what PSD2 started: letting consumers and businesses access their data across all their financial accounts, not just payment accounts.
“This means extending access, over time, to credit, savings, investments, mortgages and pensions, so customers can use third-party providers to manage their whole financial lives,” the OFA said.
The trade association also intends to support and prioritise the rollout of instant payments across the EU.
This is timely, considering sources in Brussels expect that new instant payments regulation will be proposed imminently by the European Commission.
“Instant payment systems underpin successful open payments. They turn account-to-account transfers into a viable alternative payment method.”
However, the OFA suggests that coverage and functionality of instant payment systems will need to improve to realise the potential of open payments.
“This is why the upcoming EU legislation on instant payments is so important.”
Lastly, as the European Commission sets the groundworks for an expected open finance framework, the OFA has said that priority is to create a well functioning open finance ecosystem.
“PSD2 has shown the benefits for competition and innovation of using regulation to open up data and payments,” the OFA said. “However, we believe a sustainable open finance ecosystem is one where all participants can benefit so there needs to be a balance of requirements and incentives.”
The trade association said that it has been engaging with the European Commission closely on the ongoing review of PSD2 and on the open finance consultation.
In the UK, meanwhile, it wants to ensure the Open Banking Implementation Entity (OBIE) is succeeded by a strong independent coordinator for open banking and open finance, and is working with the Strategic Working Group to help do so.
