This comes as vendors focus on expanding the services by building Second Payment Services Directive APIs
Open Banking payments are set to grow by nearly 3,000% over 5 years. Source: pexels.com
Open Banking payments are set to exceed $116 billion in 2026, according to Juniper Research.
This will be an estimated 2,800% growth from under the $4 billion Open Banking transactions in 2021. The significant growth over the next five years will be as a result of increased user awareness of Open Banking features and greater deployment within Europe.
Open-Banking facilitated payments are a threat to the dominance of cards in the e-commerce sector. Card payments are well established.
However, permissioned access to bank accounts can significantly reduce fraud cases due to the KYC rules. Payment providers should partner with Open Banking providers to minimize these risks.
In 2026, Europe will account for 75% of Open Banking payments users. However, to successfully develop advanced use cases such as credit cards, mortgages and loans, API users need to look beyond the minimum regulatory requirements.
The recent government support in Open Banking in the United States will stimulate growth in the sector. Payment players will also be required to develop capabilities to capitalise quickly. As such, partnerships and acquisitions are expected to intensify, a factor that will see vendors meet the requirements quickly.
We’ve reported that Wells Fargo rolls out mobile app update with AI-powered virtual assistant.
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