An Open Invitation to Treasury Efficiency

Practical Use Cases for Open Banking

While it remains something of a mystery to many corporate treasurers, open banking is much more than a collection of acronyms and regulatory endeavours. In fact, it is the basis of an evolving financial ecosystem that holds significant potential benefits for modern treasury departments. Here, two senior leaders from Barclays Corporate Banking dispel the myths around open banking and outline practical ways to leverage its opportunities, while streamlining treasury operations.

Open banking might seem like a relatively unexplored concept in the corporate treasury world, but it first came into the spotlight in 2013 – the year that Angela Merkel won her third term in office and David Cameron promised UK voters an in/out referendum on EU membership. At that time, the challenge facing payment regulators was that the existing framework did not adequately regulate new players in the online payments space. Something needed to change, and so the European Commission published its long-awaited proposal for a revised Payment Services Directive (PSD2).

Daniela Eder
Head of Payments & Cash Management Europe, Barclays Corporate Banking

The aim of PSD2 was not only to better protect customers online but also to promote innovation in digital payments, whilst also improving cross-border EU payments. The final directive required financial institutions (FIs) to comply with a number of changes by 2018. This included enabling regulated third-party providers (TPPs – see box 1) to access customer data held by the bank via application programming interfaces (APIs), in order to develop new apps and services. Thus, open banking was born.

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