Incumbent players in the financial services industry must commit to open data protocols and collaboration with challengers if they are to survive, according to experts at the HPS Powercard Users Meeting in Marrakesh.

Speaking on a panel assessing new trends in the payments space, HPS chief executive Abdeslam Alaoui Smaili commented: “Proper industry architecture is crucial – it has to be fully open or it will fail.”

Jeroen Holscher, head of global payments practice at CapGemini, agreed, stating: “Banks need to open up and develop ecosystems, collaborate with challengers and remain relevant to compete – improving the user experience and maintaining trust are crucial.

“Technological and regulatory developments have lowered the barriers to entry, so there’s been an acceleration of disruption in this industry,” he continued, adding: “Complexity increases, but so does opportunity.”

Moderator Liz Lumley, director of FinTech and content for VC Innovations and FinTECHTalents, proposed that the future of payments will be decided by the ‘glass generation’, or those young people who always have a glass-fronted rectangle in their hands.

Alaoui Smaili pointed out that this generation expects everything for free, and will move apps if forced to pay. “But they are happy to exchange their information to keep things free – in effect, they are the product.”

Holscher also noted the impatience of youth, which means they “don’t see the downsides of sharing their information”.

He went on to explain the paradox of regulators forcing banks to open up customer data under the second Payment Services Directive (PSD2) - something he likened to “opening Pandora’s box” - while the General Data Protection Regulation puts restrictions on the security and sharing of that data.

“Trust is an asset for traditional banks and they have rightly been slow to share personal data, but they must strike a balance; although this is yet to be found,” he stated, adding that the fact banks have good Know Your Customer (KYC) standards could potentially be leveraged in the future.

Alaoui Smaili also defended the banks, suggesting that they are unlikely to share customer data at any cost. “I’m sure that it’s as safe as our money – especially since the owner must request their data be shared.”

However, he added: “Banks must share fraud behaviour information, as security measures can only become predictive if there is cross-industry collaboration.”

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