HM Treasury and “Application Programming Interfaces (APIs) in banking” – really?
While perhaps well intentioned in calling for solutions that provide better quality comparison shopping, it worries me when I see HM Treasury calling for banks to provide an API as the solution, and also solution to what?
2.176 Application Programming Interfaces (APIs) in banking – Following publication of a Government commissioned report on APIs and open data, the government will launch a Call for Evidence on how APIs could be used in banking. This will enable financial technology companies to develop innovative solutions to allow customers to make better comparisons between different banks and financial products.
I think they should stop at the “develop innovative solutions” if they are really serious about this, and let technologists develop an approach for whatever they intend to gain.
But having said that what is the governments intention. Based on the earlier Banking Commission findings, its probably in the realm of reducing friction for consumers wishing to change banks. If that is the intention, then ‘better comparisons’ is not what they seek. Better comparisons will be provided by innovative FI’s and innovative comparison providers, which is an area UK is already ahead of most.
The friction which I believe they are concerned about lies in the area of Direct Debits and Credits and the pain involved in making those changes. However that pain is significantly reduced now compared to 10 years ago.
Which takes us back to … what does HM Treasury intend in this Autumn Statement.