Open Banking – Register with the FCA as an AISP or PISP
In August 2016, the UK Competition and Markets Authority (CMA) issued a ruling that required the nine biggest UK banks – HSBC, Barclays, RBS, Santander, Bank of Ireland, Allied Irish Bank, Danske Bank, Lloyds and Nationwide – to allow licensed startups direct access to their data down to the level of account transactions. Open banking has led to a raft of new financial technology products and companies. The term Open Banking refer to the following:
- The use of open application programme interfaces (APIs) that enable third-party developers to create apps and services around a financial institution.
- Increased and secure financial transparency for account holders.
- The use of open-source technology to achieve the above.
- Open banking Ltd, a non-profit created to facilitate for the task.
The New Jargon
TPP – Third party payment service provider
A payment institution which does not hold payment accounts for its customers and provides payment initiation and/or account information services. It can act as:
Account information service provider
Aggregation of online information for multiple payment accounts in order to offer a consolidated view of finances and avoid multiple website visits and logins
Payment initiation service provider
Facilitation of online banking to make a payment
Account servicing payment service provider
Responsible for maintenance of the customer’s payment account, The ASPSP must provide the AISP or PISP with a secure communication channel allowing access to the payment account if the account holder has authorised it.