The role of fintech has largely been relegated to making incremental improvements to the banking interfaces and actions consumers take when conducting there day to day business. The article outlines how a fundamental change to the landscape with the introduction of a digitally-native clearing bank in the U.K. will change the field of play dramatically.
Free from the constraints of legacy technology and built on cloud infrastructure, ClearBank delivers open access to payment, current account and transactional clearing services. Regulated FinTech start-ups to incumbents will be able to access all of the UK payment schemes through a single API integration.
Mercator Advisory Group views the development in the U.K. with interest, but also recognizes the open banking format in effect in the U.K. is much more open to accepting new players and innovation than the regulatory apparatus in the U.S. today. However, the recent opening of special bank charters for fintech-oriented companies by the OCC opens the door to a more robust cohort of challenger banks. We expect this development signals U.S. legacy players to accelerate their own plans to migrate deeper into the digital environment, and demonstrate the value they are able to deliver from their brick and mortar locations as well.
Overview by Joseph Walent, Customer Interactions Advisory Service at Mercator Advisory Group
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