What is open banking?

What is open banking?

What is Open Banking?:

Open Banking is part of a series of changes to the future of banking and how banks deal with your financial information. The new regulation, Payment Services Directive (PSD2), came into effect on 13 January 2018.

It means that banks will have to let its customers share financial data such as regular payments used, with authorised providers, as long as you give permission.

Intelligent Data Sharing:

Intuit QuickBooks was one of the first companies to register with the Financial Conduct Authority for qualified third-party status under Payment Services Directive (PSD2). If you’re sharing your bank details with another organisation, make sure they’re authorized too. Check the FCA’s Register or the Open Banking Directory. [1]

Therefore, QuickBooks, alongside many other companies will now be providing updates so that their software can work more intelligently to provide accurate and up to date information directly from the bank. It is a new and secure way for consumers to share information, allowing companies to provide innovative banking products.

What does this mean for you?

QuickBooks bank feeds will be updated over the summer and the old feeds phased 

It allows customer to have more choice in products and services. This can range anywhere from personal finance management to debt management tools. As a business this can also help with your accounts, cash flow management and even tools to make it easier to secure a loan.out. Don’t panic though, QuickBooks have promised to provide step-by step instructions in time for the switch in September. ‘And the good news is, the upgraded feeds will be more stable and accurate than the current system. You’ll just need to re-authorise the connection every 3 months.’ [1]

Access All Areas?

Under PSD2/Open Banking, you have complete control of who can access your financial data. You can grant specific permission to third parties such as QuickBooks, or withdraw it at any time – so if you only grant access to a current account, your credit card account won’t be automatically included. [1]

Essentially, you will have to allow permission for any third party to access any of this personal information and therefore it is a secure method of having everything integrated. The peace of mind you’ll get from improved levels of security is one of the key benefits of Open Banking and PSD2. Under the new system you can sync accounts without having to hand over passwords or login details to third parties.

Instead, with your permission a third party will ask your bank for access to your financial data, and they will contact your bank. Then you just log in to your bank as usual to authorise the connection. It’s as easy as that! [1]

Want to know more?

Interested in learning more about open banking or have any questions? Give us a call or send us a message today and we will be happy to help.

 

[1] Intuit QuickBooks https://quickbooks.intuit.com/uk/