How HSBC is meeting the challenges presented by open banking

Ahead of her presentation at the upcoming CCX Forum in London, Diana Biggs, head of Digital Innovation for UK and Europe in HSBC’s Retail Banking and Wealth Management practice, explains the opportunities presented by open banking and how they can be best leveraged.

How HSBC is meeting the challenges presented by open banking

What challenges and opportunities does open banking present to retail banks, and why?

For retail banks, open banking essentially means making their services accessible through third-party platforms and integrating third-party services into our own platforms. I see this largely as an opportunity for us to innovate, rather than a threat. In our recent Trust in Technology report, we found that 84% of people would be willing to give more data to their banks if it meant they would receive better service – this is the aim and a positive.

Seeing this as an opportunity, we’re launching new digital propositions to explore how open banking can allow us to better serve our customers and provide additional value-add over and above what is possible today. For example, we’ve recently announced the upcoming launch of a new app, Connected Money, here in the UK. Connected Money is the next step in HSBC UK’s digital journey to help customers manage their money in a simpler way. It allows customers to see their current and savings accounts, mortgages, loans and cards held across several banks, including non-HSBC accounts, in one app and will contain a number of evolving innovative features that take the hassle out of managing your day-to-day finances.

In what ways can banks overcome these challenges?

Technology is increasingly important to customers and they have high digital expectations. Banks need to leverage the latest technology to gain a competitive edge. Here at HSBC UK, we see collaboration between fintechs and the larger banks as imperative to providing the best results for customers. It’s an approach we’re actively taking, and the UK is a great place to be for this, as we’re at the heart of a thriving fintech ecosystem. We also have a regulator that encourages and enables innovation through initiatives like the FCA Sandbox, in which we were the first major bank to participate, creating a customer savings offering called SmartSave in partnership with fintech startup Pariti. We’re currently working within the FCA Sandbox for a second time, in partnership with fintech startup Bud through our First Direct brand.

How do you think banks will use technologies like AI and robotics to make the operations more efficient, reduce operating costs and reach new customers?

The opportunity for the use of technologies like AI to increase efficiencies, reduce costs and extend customer reach for banks is large, whether directly through new systems, assisting with compliance or automating the onboarding process. At HSBC UK, we are already using it for several applications including protecting customers from financial crime. Robo-advice also has a big role to play - AI software is already becoming more intelligent and we’ll be rolling out a new product in that space this year. There are also huge opportunities for AI technology to align with mobile, cloud computing and data analytics. The convergence of these trends and the potential integration offer great opportunities to the industry.

In what ways will banks be able to use the above technologies to better engage with customers and improve their overall experience?

At HSBC, we are actively doing this and are investing more than £2 billion in digital technology globally. This includes redeveloping mobile and browser experiences for customers in all of our major markets, introducing peer-to-peer payments services, rolling out biometric technology, as well as testing innovative new propositions to ensure we are meeting the ever-evolving needs of our customers. To do this, we are testing out new features with customers in real time and bringing the most advanced banking technology to market. We are uniquely positioned as our scale gives us an awareness of digital trends and developments across 67 markets, providing us with the opportunity to spot and develop innovations that will be of most benefit to our customers in the future.

When do you think open banking, AI, robotics and similar digital technologies will become mainstream?

Open banking is now a reality in the UK. As with any new technology or service, there is naturally an adoption curve as customers begin to understand what this means to them. For the majority of people, understanding is more likely to be inferred through the service offerings, rather than any explicit understanding of what the regulations are or a definition of “open banking”. These technologies, such as AI, are already part of our lives but as underlying layers seamlessly integrated into the products and services.

Many of our customers already choose to manage their finances digitally and this trend will continue. Over the past three years, an additional 1.5 million customers have started to use our digital banking services, and customers using our mobile app have increased by more than 220%. In our innovation teams, we are exploring and testing these emerging technologies to identity those which can provide a clear benefit to our customers and apply them to our products and services to make them simpler, faster, more efficient and more secure on an ongoing basis.

Diana Biggs will speak at the CCX Forum: Channels and Customer Experience. Save your place at the event and join her and many other top level speakers!

Signature_CCX_Forum.png (34 KB)


Open Ecosystem Fintech Digital/Mobile channels AI/Robotics


United Kingdom
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