New regulations encouraging open banking may bring additional operational challenges, but research shows open banking has the power to transform the global banking landscape over the next decade, writes JACOB MORGAN of Forrester.
Open banking is the next step in the digital banking evolution. By participating in partnerships and collaborative ecosystems, banks will be able to further their drive to enable customer outcomes.
Digital technologies such as APIs will sit at the heart of open banking as software and accessibility drives further disruption and business models evolve. Open banking blows apart the insular nature of many banks and will transform the banking landscape, as noted in the new report: The Open Banking Revolution is Imminent.
There have been a number of moves from global regulators and banking advisory committees pushing for a move towards open banking over the past few years. Europe is less than a year away from implementing the second phase of the Payment Services Directive (PSD2). The Open Banking Development Group was set up to devise a global Open Banking Standard late 2016 and Australia and the UK have also seen moves towards legislated open banking standards.
The regulators are promoting open banking to drive innovation and increase competition in the market, to benefit the customer.
While these are lofty ideals, few understand either the full implications or the opportunities offered by open banking.
Among the common misunderstandings is confusing open access with a relinquishing of control. While interfaces are public facing, banks do not need to relinquish access control, management of data and services, or the ability to monetise access.
APIs will open up collaborative ecosystems which can enable real-time connections and collaboration opportunities for banks and their partners. Allowing third parties access to product catalogues, business processes, data and business processes, banks can expand their presence, boost sales and increase revenues. Moreover, some banks are already experimenting with open developer platforms which are driving innovation.
However, there are potential downsides to the new requirements, unless banks put their customers at the heart of their future strategies.
Open data will allow for granular product and service comparisons, which could lead to dissatisfied customers switching banks. Open standards will also amplify interoperability which will, in turn, foster collaboration. New products and services will drive competition into the market and could pose a threat to banks which are complacent. A more open environment will also make barriers of entry far lower. For banks which have been used to the prohibitive licensing and regulatory hurdles, having a flood of nimble, new entrants could pose a further business threat.
True open banking transformation will not happen overnight and Forrester believes that this may only materialise over the next decade. However, the report details some actions which banks can take in the shorter-term to prepare for the future.
This includes building a strategy which is centred around what future partners will need from the engagement, including developers and third-party partners. The company has also advised banking professionals to spend some time determining how they will build their future ecosystems as well as the role they would like to play in it.
Finally, the research cautions that banks should build flexibility into their strategy. Prioritising investments that will ensure fast response times in the technology as well as the processes and skills will drive agility into the organisation and better prepare it for the future.
Jaguar drives dictionary definition
Jaguar is calling for the Oxford English Dictionary and Oxford Dictionaries to update their online definition of the word ‘car’
Jaguar is spearheading a campaign for the Oxford English Dictionary (OED) and Oxford Dictionaries (OxfordDictionaries.com) to change their official online definitions of the word ‘car’.
The I-PACE, Jaguar’s all-electric performance SUV, is the 2019 World Car of the Year and European Car of the Year. However, strictly speaking, the zero-emission vehicle isn’t defined as a car.
The OED, the principal historical dictionary of the English language, defines a ‘car’ in its online dictionary as: ‘a road vehicle powered by a motor (usually an internal combustion engine) designed to carry a driver and a small number of passengers, and usually having two front and two rear wheels, esp. for private, commercial, or leisure use’.
Whereas the current definition of a ‘car’ on Oxford Dictionaries.com, a collection of dictionary websites produced by Oxford University Press (OUP), the publishing house of the University of Oxford, is: ‘A road vehicle, typically with four wheels, powered by an internal combustion engine and able to carry a small number of people.’
To remedy the situation, Jaguar has submitted a formal application to the OED and OxfordDictionaries.com to have the definitions updated to include additional powertrains, including electric vehicles (EV).
David Browne, head of Jaguar Land Rover’s naming committee, said: “A lot of time and thought is put into the name of any new vehicle or technology to ensure it is consumer friendly, so it’s surprising to see that the definition of the car is a little outdated. We are therefore inviting the Oxford English Dictionary and the Oxford Dictionaries to update its online classification to reflect the shift from traditional internal combustion engines (ICE) towards more sustainable powertrains.”
The Oxford English Dictionary is widely regarded as the accepted authority on the English language. It is an unsurpassed guide to the meaning, history, and pronunciation of 600,000 words – past and present – from across the English-speaking world.
Jaguar unveiled the I-PACE, its first all-electric vehicle, last year to deliver sustainable sports car performance, next-generation artificial intelligence (AI) technology and five-seat SUV practicality.
Featuring a state-of-the-art 90kWh lithium-ion battery, two Jaguar-designed motors and a bespoke aluminium structure, the I-PACE is capable of 0-100km/h in 4.8 seconds and a range of up to 470km (WLTP).
While both the Oxford English Dictionary and Oxford Dictionaries review the application, Jaguar is encouraging people to get behind the campaign by asking how the word ‘car’ should be defined. Contact Jaguar on Twitter, Facebook and Instagram using #RedefineTheCar with your thoughts.
How Internet blocks visually impaired
A pervasive “digital divide” inhibits blind people from accessing the Internet, according to a study conducted by Nucleus Research for Deque Systems, an accessibility software company specialising in digital equality. This results in visits to websites being abandoned, further resulting in a missed market opportunity for the websites in question.
The study, which conducted in-depth interviews with 73 U.S. adults who are blind or have severe visual impairments, revealed that two-thirds of the Internet transactions initiated by people with vision impairments end in abandonment because the websites they visit aren’t accessible enough. Ninety percent of those surveyed said they regularly call a site’s customer service to report inaccessibility and have no choice but to visit another, more accessible site to make the transaction.
The Nucleus study also scanned hundreds of websites in the e-commerce, news and information and government categories and found that 70 percent had certain “critical blockers” that rendered them inaccessible to visually impaired users.
“Besides the moral dilemma and legal risk, businesses with inaccessible websites are missing a huge revenue opportunity by ignoring an untapped market,” says Preety Kumar, CEO of Deque Systems. “Among internet retailers specifically, two-thirds of the top ten online retailers had serious accessibility issues, meaning they are leaving $6.9 billion in potential North American e-commerce revenues on the table.”
Web accessibility refers to the ability of people with disabilities to independently gather information, complete transactions, or communicate on the Internet. Most visually impaired Internet users rely on assistive technologies like screen readers or screen magnifiers to render sites perceivable and operable. However, these assistive technologies require that websites be built with accessibility in mind and optimized to interface with assistive technology, in order to convey information in an accurate and understandable manner.
Critical accessibility blockers can vary across industries. In e-commerce, problems include issues like missing form and button labels (thereby making forms or the “checkout” button invisible without context). Amazon, Best Buy and Target were found to be accessibility leaders in this space. Additionally, the study found:
- Eight out of ten news sites had significant accessibility issues.
- Seven out of ten blind persons reported being unable to access information and services through government websites, including Medicare’s site.
- Fewer than one in three websites have clear contact information or instructions for blind persons to seek help if they encounter accessibility issues, meaning many have low levels of success in reporting and solving these problems.
“A focus on accessibility needs to be a core part of the website design and development process,” continues Kumar. “Considering accessibility as early as the conception phase, and proactively building and testing sites for accessibility as they move towards production, is significantly more effective than remediating it later, helping organizations save significant time and resources while avoiding unnecessary customer grievances.”
To download the report, visit: https://accessibility.deque.com/nucleus-accessibility-research-2019