Comment: Scots fintechs can lead open banking out of its infancy

Scotland's strength in data science can see it become an Open Banking powerhouse, says Steve Tigar. Picture: Stewart Attwood
Scotland's strength in data science can see it become an Open Banking powerhouse, says Steve Tigar. Picture: Stewart Attwood
Share this article
Have your say

Later this week, the great and the good of the burgeoning open banking industry jet into Edinburgh for FDATA’s Global Open Banking Summit. Scotland is a worthy host, seen by many to be the home of open banking, with a string of first adopters including our own company, Money Dashboard, and the like of miiCard almost a decade ago.

Since then, an entire new generation of financial technology companies have joined the scene and are genuinely challenging the traditional banks. At the same time, valuations for fintechs have risen sharply as investors increasingly concur with the view that financial services will be transformed by digital disruption. It seems fitting that the post-summit awards will be taking place at the National Museum of Scotland, as most would now agree that plain vanilla bank products already feel like relics from the past.

The EU’s “open banking rules”, given the green light by UK regulators in January, mean lenders are obliged to allow fintechs access to the data and accounts of any customers who give their authorisation. Monzo, Revolut and Starling Bank are among the UK players making a name for themselves in a maturing market, and we are working hard to make sure we are among the band of disruptors to make the most of the industry’s shifting plates.

As we plan to scale like some of our industry peers, we do so on the back of a record 2018. Our free personal finance app has now been downloaded almost half a million times, we picked up Best Personal Finance App at this year’s British Bank awards for the second time and we continued to grow our anonymised consumer spending insights business with a customer base that includes some of the world’s leading asset management firms.

In order to support our growth plans, we are actively considering a significant capital raise in 2019. Crowdfunding is one of our options having raised £1.4 million on Crowdcube in 2017, where more than one thousand of our app users contributed to the round. It is encouraging to know that our plans to scale take place against a Scottish fintech backdrop that is going from strength to strength – with fast-growing Nucleus Financial and newly-created industry body FinTech Scotland having added considerably to the Scottish fintech narrative.

This week, we are set to announce a strategic partnership with a prominent UK fintech player that will spur accelerated innovation in the rapidly developing open banking arena. Overall, while we are in an exciting space it would also be true to say that collectively we have still to really scratch the surface on what is possible.

As machine learning and data science become integral to the development of open banking, we would expect progress to lurch forward in leaps and bounds, with exciting new propositions being launched in savings, pensions, investment and credit. The more we work alongside other industry pioneers – the last twelve months have also seen us form partnerships and integrations with Monzo, Starling Bank and PensionBee – the bigger the opportunity we have to provide a safe and secure way for consumers to get on top of their finances and, ultimately, to lead happier and more successful lives.

Bill Gates remarked back in 1991 that “banking is necessary, banks are not”, words repeated recently by HSBC’s head of open banking delivery at a major international conference that hinted at how starkly the incumbent banks are viewing their position vis-a-vis challenger banks and products.

At FDATA’s Global Open Banking Summit at McEwan Hall on Thursday, preceded by MoneyLIVE, Europe’s largest retail banking conference, Money Dashboard has secured prominent speaking slots to ensure that our voice remains to the fore as the open banking industry throws off its fledgling shackles and prepares for a new dawn in financial technology.

- Steve Tigar, CEO of Money Dashboard