Why are open banking models in Europe underperforming?

This study investigates the foundations underpinning open banking models in Europe and identifies levers to improve their performance. Based on a review of the literature, it distinguishes four contexts for open banking: platformisation, data sharing, FinTech and regulation. The users of open banking services are surveyed to determine factors driving adoption and identify those entities that customers trust with their data and funds. The results indicate that the slow adoption of open banking services is in large part due to customers’ poor understanding of such services. The results also show the importance of usefulness and trust in driving adoption. These findings highlight the disproportionate attention being given to service provider infrastructure and the ecosystems of new entrants, and indicate that more consideration should be given to the actual users of open banking frameworks. In response to the findings, the study proposes a roadmap to mitigate the main weaknesses in current open banking models. The conclusions of this study are relevant not only to the development of open banking regulations in other territories, such as the USA and Canada, but also to the extension of data-sharing regulations to non-banking sectors.