Competition in open banking payments is getting more fierce. Now even more so with GoCardless being the latest platform providing the service, just months after raising $95 million in Series F funding. This article breaks down the open banking service GoCardless just announced and touch upon how far open banking has come in Europe.
After announcing its intention to accelerate its open banking strategy last year, GoCardless just launched one-ff bank-to-bank payments for its customers in the UK.
For now, this service is exclusively available to UK merchants, and serves customers paying via a limited number of banks. That being said, the service is expected to be rolled out to more countries later this year.
It is actually quite simple. Merchants can send a link to request payment, or build the option into their checkout flow, after which customers are connected to their bank and can authorise the payment in a few clicks, followed by an instant payment confirmation.
Although open banking is still a new concept, Europe is seeing a positive growth trend in Third Party Providers. At the same time, individual European countries differ in how well and how far they have progressed towards making open banking a success.
According to industry experts, Europe is falling behind the UK when it comes to open banking adoption. Even though a number of banks are highly advanced in their strategies, many are still struggling to adapt and innovate.
Currently, the most prevalent open payments application are:
We however, would say there are many more possibilities within open banking. We believe that it can play a key role in boosting customer experiences and customer retention in verticals such as online gaming.
To conclude, Europe is on the right track to accelerating open banking adoption, but there is still a long way to go before we fully utilize and realize the possibilities within open banking. We suspect that the main reasons Europe is falling behind are the lack of readiness from local banks and technical complexity.
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