r/fintech – I believe not online retail customers but also business customers will benefit from open banking and embedded finance.

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According to new data published by the Open Banking Implementation Entity (OBIE) together with Ipsos MORI half of Britain’s small and medium-sized enterprise (SME) sector are using services offered by open banking providers.

These firms, consisting of 1-49 employees, have swayed towards the technology primarily for the cloud accounting and cashflow forecasting benefits. Whilst the former is used by 24% of the 500 businesses surveyed, the latter is used by 21%.

Almost three-in-five SMEs started using open banking-enabled services in the last six months, with 90% explicitly stating that their usage is a direct result of COVID-19.

What could another except Covid-19? I think another reason is the ease of switching from one account to another without losing your data.

Constanza Castro Feijóo, OBIE’s small business engagement spokesperson, notes that the report found “the main barriers to adoption stemmed from SMEs’ unfamiliarity with open banking and how it could help their business”.

“Some SMEs said they were wary of ‘opening up’ their data to third parties,” she adds.

Originally posted on LinkedIn

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