is powering the next generation of ‘API-Based Banking’

Blockchain Open Banking

Although the focus of Blockchain has been headlined by its role in enabling cryptocurrencies, the technology will also act as a core technology for facilitating the goal of Open Banking, better integration across the ecosystem.

For example Sam Mire identifies 14 possible use cases for Blockchain in Banking, including interbank transactions, cross-border transactions and remittance, and clearing and settlement. The sweet spot will be where the technology facilitates both digital currencies and also integrated features for their exchange.

For example payments firm Wirex is launching 26 stablecoins on the Stellar blockchain network, that can be spent using its own multi-currency Visa card. Wirex’s card allows users to convert and spend cryptocurrencies wherever Visa is accepted.

Plucky startup Ramp is enabling a ‘virtual bureau de change’, leveraging Open Banking capabilities to facilitate “atomic swaps”, where one cryptocurrency can be swapped directly for another– but with fiat to crypto.

It’s not just startups pioneering the field. JP Morgan is utilizing the Blockchain to expand the capbilities of its IIN – Interbank Information Network, adding 200 banks to the network. is a great example of a venture prosecuting this sweet spot.

They offer an Open Banking platform, a suite that includes a single account aggregation API, a bank payment service, and a SaaS solution for achieving PSD2 compliance.

They also offer their own stablecoin Token X. A stablecoin is a crypto pegged to a fiat; partners with Alliance Trust to hold these in escrow. Omnio Group and Mastercard have selected Token for their Open Banking initiatives.

Omnio is integrating the technology with their bank.VISION digital banking platform, to deliver enhanced capabilities to customers like Irish postal, retail and financial service provider An Post, enabling them to bring together accounts from multiple institutions holistically into a single customer view.

Token has been selected as Mastercard’s partner to launch their connectivity hub, which will deliver secure connectivity between third parties and financial institutions’ APIs, using Token’s operating system, TokenOS.

Token believes 2019 will be The Breakthrough Year of Open Banking. With Blockchain and Open Banking each being hyper growth markets in their own right, their intersection will be a white hot tsunami of innovation and opportunity for radical models for digital disruption.

API-Based Banking

In his interview with Open Banking Excellence CEO Todd Clyde describes their approach as a two sided solution for a two sided problem. This means ensuring the quality of data provided by banks and making it easy for users to consume.

Their API platform for banks enables them to create ‘premium APIs’, powering the next generation of financial applications – “Putting a bank in every app”.

Todd says we’re transitioning from a first use case for Open Banking being PSD2 compliance to now one of an era of API-based banking. The key inflection point is that users will no longer solely log on to their banking app to access financial products, instead these will be integrated into their other daily lifestyle experiences.

Going beyond compliance to these new integrated use cases is the critical enabler for banks to monetize the Open Banking trend.

To advance the overall sector Todd would like to see the industry collaborate to reduce the barriers to Open Banking, notably the fragmentation of implementations, friction caused by inadequate authentication, enhancing the functionality of APIs and TPP on-boarding challenges, achieved through improved standardization, regulation and collaborative innovation.

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