65% of banks consider Open APIs ‘key to modernisation’

Nearly two-thirds (65 per cent) of banks believe that Open APIs that enable partnerships with a broad range of FinTechs and consolidation of payments types are key drivers for the modernisation of payment systems.

A survey of nearly 100 banking executives by ACI Worldwide and Edgar, Dunn and Company also found that a third of financial institutions now generate over half of their income via payment processing, with 86 per cent of large banks generating more than 30 per cent of their revenues through this channel.

Nearly half (48 per cent) of respondents said current legacy systems no longer meet business or customer needs and are not flexible enough to keep up with the pace of change coming from the modern payments world.

Over half also said they experience a siloed approach to support different payments processes and systems within their institution.

When asked about possible solutions to these challenges, over 90 percent of financial institutions said they viewed payment hubs as pivotal in tackling unseen payments-related challenges.

A total of 40 percent said their bank already has a payment hub solution, while 45 per cent of financial institutions currently do not have one but say they are likely to implement one in the next five years.

More than 77 per cent said that “faster and smoother adoption of new payment methods” would be the key feature required from a payments hub solution.

Commenting on the findings, Mark Beresford, director, at Edgar, Dunn and Company said: “Financial institutions are keener than ever to connect to the new opportunities provided by the widening catalogue of FinTechs.”

“By having Open APIs, the connectivity between historic financial institutions and new players dramatically improves. And, in a world where both quantity and quality of alternative payment methods is rising exponentially, it is no surprise to see that banks are trying to simplify their approach to these offerings.”

    Share Story:

Recent Stories


New Business Frontiers
FStech’s Mark Evans discusses the future of financial services with Liu Jianning of Huawei, covering the limitations that current thinking can impose, how financial institutions can embrace technology to be both agile and resilient, and making space for the organisation to focus on the job of creating innovative business models and on delivering business value for their customers.

The Future of Intelligent Finance
FStech Group Editor Mark Evans sits down with Jason Cao, President of Global Financial Services Business Unit, Enterprise BG at Huawei ahead of its Intelligent Finance Summit which was held on 3rd and 4th of June in Shanghai. This Q&A delves into key trends in digital transformation of the financial services industry as well as a look at how data, robotic infrastructure, intelligent storage and innovative technologies are shaping the future for FSIs.

Cracking down on fraud
In this webinar a panel of expert speakers explored the ways in which high-volume PSPs and FinTechs are preventing fraud while providing a seamless customer experience.