Data released by Yapily, an open banking infrastructure provider, has highlighted that open banking is continuing on a steady growth in the UK as top national banks strengthen investments in the technology. 

The research revealed that all of the surveyed banks have benefited from an improved average API response speed for the period between 2020 and 2021, with some financial institutions showing improvements by up to 37%. 

Furthermore, the detailed analysis by Yapily outlined that the average API response time across UK banks for 2021 was 511 milliseconds, which is an increase of 28% from 2020. 

The technology has evidently become more popular with UK users. Numbers show that at the end of 2021 more than 26.6 million open banking payments had been made in the UK, an increase of 500% in just 12 months. OBIE further reports a 60% open banking user adoption between 2020 and 2021. 

Yapily Data

Typically, more transaction volumes would result in a higher latency, but the overall faster response times show that in this period banking providers have invested heavily in the open banking infrastructure, very likely to continue doing so in the future as well. 

Roland Selmer, Chief Product Officer at Yapily, commented: “For the customer, faster response times will create a slicker and more convenient user experience. For businesses, benefits include faster access to financial data, reduced abandonment rates, and increased levels of customer trust.”

Selmer also added that response speed is just the tip of the iceberg when it comes to improving the UK’s open banking architecture, urging financial providers to invest more in the ecosystem:

“Over the next 12 months, banks, fintechs, and Technical Service Providers (TSPs) alike will need to continue to invest in open banking architecture. In order to increase adoption, improving API reliability, uptime and user journeys will be key as this will ultimately have the biggest impact on improving conversion rates.”

CEO and Founder of Yapily Stefano Vaccino added: “To measure the success of open banking, we need to look at both user adoption and the quality of the infrastructure underpinning the wider ecosystem. The implementation of open banking in the UK has always been reliant on the readiness of the CMA9. With strong improvements in year-on-year API response times, this evidence is a positive indicator for the direction of travel and maturity of open banking in the UK.”

UK banks are expected to continue the adoption of open banking, expanding their offerings through brand new functions based on the technology.

“In 2022, I expect to see continued improvement across the UK banks as they develop and launch new APIs and functionalities, enabling more innovative use cases”, Vaccino said. 

“In the wider ecosystem, we will see account-to-account payments compete even more closely with existing payment methods like credit and debit cards. And at some point in the near future, we will have seen a major platform integrate open banking into their payment workflow, giving rise to an inflection point in consumer adoption.”