New access models enabled by open banking and FinTech offer an effective approach for serving consumers and businesses traditionally excluded from conventional banking. By implementing secure data-sharing capabilities alongside customer onboarding tools and analytics systems, it is possible to create accessible digital financial solutions that simplify processes for marginalized populations.
Incorporating open banking into business strategy serves the dual purpose of maintaining competitiveness while achieving meaningful financial inclusion, as well as improved compliance standards and more personalized interactions with users.
What is open banking data and how does it work?
Open banking data is obtained when customers give their consent for their financial information to be securely shared with third parties through APIs. The APIs work within the framework of open banking standards to manage data with user consent, transparency, and full compliance with PSD2 and the upcoming PSD3 legislation.
By adopting open banking, institutions can obtain up-to-date banking information, enabling them to create personalized services, perform instant credit checks, and deliver tailored customer interactions. This access to data empowers institutions to create value not only for themselves but also for the broader community.
Enhancing Customer Onboarding Processes in Digital Banking
The initial customer onboarding process is key to building trust given that it is the first point of interaction with underbanked customers who may also lack digital experience. The traditional customer onboarding process involves slow, often manual, procedures that can put off potential customers who may not have any formal documentation or financial records.
Customer onboarding can be improved using digital solutions that provide automated ID verification, document uploading capabilities, and secure data collection methods. Onboarding solutions with a flawless, mobile-centric design increase user satisfaction and expand the prospect base while improving conversion rates.
Open banking software: revolutionizing financial accessibility
Institutions can develop advanced, fast, and accessible financial services using open banking software to improve accessibility. The system's ability to deliver these benefits stems from the following key features:
- The use of secure API connectivity helps to process customer accounts in real time, in accordance with consent regulations and compliance standards.
- AI algorithms analyze customer transactions to build profile accuracy through spending and saving activities.
- Different credit scoring systems allow the calculation of scores for customers who do not have traditional credit records, increasing credit availability.
- The system offers integration with digital customer onboarding procedures that reduce operational hurdles in the acquisition process.
- Data analytics provide insights that lead to better business decisions while delivering personalized products to customers.
- Agile deployment enables institutions to extend inclusive service delivery across multiple geographies and customer demographics.
Open banking software helps reimagine services using real-time data to create more informed and comprehensive financial interactions. CRIF's open banking service provides comprehensive tools that enable institutions to measure creditworthiness and track risk through PSD2 data collection. Powered by GenAI technology, the platform performs transaction classification at the highest level, helping to meet KYC/KYB requirements while providing real-time user profiles and active risk management capabilities.
The rise of customer onboarding software in FinTech
By their very nature, FinTech startups, alongside digital-first banks, require user onboarding software as a core component of their operations. Today’s customer demand for instant, seamless experiences mean that institutions need to implement onboarding solutions that provide both robust compliance and an intuitive user experience.
Online platforms now combine document scanning, facial authentication, and AI-powered crime prevention technology in a single system.
With these capabilities, institutions can onboard a diverse range of customers, including recent immigrants, independent contractors, and atypical financial users. Modular cloud-based onboarding software enables institutions to create customizable processes that meet regulatory requirements while accommodating different user types, helping promote early financial inclusion and reducing user attrition.
Benefits of open banking for underbanked populations
Open banking technology is transforming financial access by successfully reaching excluded populations with limited or non-existent options for traditional financial services. This infrastructure offers institutions many opportunities:
- Development of a system that enables unbanked users to access financial products by analyzing their transaction data for expenditure and income indicators.
- Digital KYC processes, together with mobile-based remote account opening, help to reduce the entry barriers for new customers.
- Ability to cut operational costs to profitably support underserved communities.
- Design of financial products specifically for individuals based on their track records, updated with behavioral information.
- Creation of personalized financial education resources that help customers build credit scores, monitor spending, and start financial planning.
- Development of flexible services that analyze customer needs to reinforce successful customer retention strategies.
The adoption of these features helps achieve market expansion and plays a vital role in promoting inclusive, sustainable economic development. The combination of open banking and FinTech innovation is driving transformative financial inclusion. Institutions can provide better, faster, and more accessible services to every customer through open banking data integration and digital onboarding solutions, working alongside CRIF.
Explore how CRIF's open banking suite can support your financial inclusion goals — request a demo today
These capabilities go beyond the usual business benefits. This commitment drives financial transformation toward a fairer system that delivers an inclusive solution for today's digital marketplace.
