Open banking is a hot topic in financial services at the moment. The term open banking is a broad term that has come to mean different things to different people. In general, from a customer point of view, it’s about having more access and use of their bank data. How banks and third parties view this topic really depends on what market they’re operating in and what approach is being taken – whether it’s regulatory-led, co-led, or a market-led approach.
Rather than open banking as conceived in places like the UK, Payments NZ has been working with the industry here to develop common payment-related API standards. We recognise that these common API standards and a supporting framework have the ability to drive more openness, greater efficiency and ongoing innovation in payments. Collectively, we are focused on developing a shared API framework and standards that are right sized for New Zealand.
As part of our Payments Direction strategic initiative, we launched an industry API pilot with six development partners earlier this year. The pilot is testing two API standards: account information and payment initiation, and is set to wrap up later this year. From pilot feedback we have also started work on developing a consent management (enduring consent) API. This work is advancing well and we’re looking forward to making the draft of the two pilot standards available within the next few weeks.
The industry has also been busy developing a shared API management framework. This framework will set out how organisations (including API providers and third parties) can access and use the standards once they’re in the market, and contribute to their ongoing development.
You can find out more detail about the API framework and pilot on our website.
It is a point of pride for us that our work on a shared API framework and common API standards is being led by industry. It’s all part of an overarching industry strategy to deliver the desired payments and API ecosystem of the future, tailor made for our small yet mighty nation.
If any of FinTechNZ members are interested in finding out more about Payment NZ’s work, please email the team at email@example.com