Open banking in the UK made significant strides in 2024, yet challenges remain as we move into 2025. It’s vital for the sector to address these hurdles for continued growth.
- Open banking payments reached a record high in January 2024, with the UK’s roadmap fully realised.
- User numbers surged, with a 12% increase in July 2024, doubling since 2022.
- Despite progress, regulatory congestion and sluggish advancements hinder the industry’s potential.
- The National Payments Vision has offered some clarity, but more decisive actions are necessary.
In 2024, the UK saw open banking achieve remarkable progress, marked by a record high in payments this January. The full realization of the open banking roadmap underscores this success. However, as the year progressed, it became evident that further action is required to sustain and enhance this growth.
July 2024 recorded an impressive 12% rise in open banking users, reaching 11.3 million. This figure is double that of 2022, reflecting increasing public trust in open banking services. Yet, despite these achievements, the sector grapples with regulatory congestion that slows down its momentum.
The anticipated robustness in commercial Variable Recurring Payments (VRP) hasn’t materialised, primarily due to the optional nature of its implementation by banks. The absence of regulatory mandate for banks to integrate this capability into their systems curtails its potential.
Amidst these challenges, the National Payments Vision offers some direction, although questions linger as the industry looks towards 2025. It is crucial that regulatory frameworks evolve to support the integration of innovative banking solutions, enabling a seamless transition forward.
Open banking must overcome regulatory and operational hurdles to achieve its full potential in 2025.
