Salt Edge announced its new solution enabling institutions to get access to open banking channels at LendIt Fintech Europe, a conference Business Insider Intelligence attended. The new solution, dubbed Salt Edge Partner Program, was designed for third parties such as lenders, credit bureaus, and fintechs that are aiming to leverage account data made available via open banking to create new services, without having their own PSD2 licenses.
Here’s why Salt Edge’s new solution will likely see high uptake across the industry:
- The solution enables third-party providers (TTPs) to access PSD2 data without having to build channels in-house to do so. PSD2 has strict requirements for third parties that want to access data from banks via their APIs, including obtaining their own PSD2 license, as well as building and maintaining a secure infrastructure. The Salt Edge Partner Program enables third-party companies to access open banking channels from banks within 15 minutes, without having to handle technical, security, and compliance matters. It can connect to over 400 open banking APIs across Europe.
- Connecting with PSD2 interfaces from banks remains a challenging task for TTPs. PSD2 interfaces provided from banks can differ per institution, even within the same country. They have different documentation, technical specifications, and integration processes, which makes it difficult for TTPs to seamlessly integrate with multiple banks. Additionally, Swedish fintech Tink found that none of the PSD2 APIs from financial institutions (FIs) across Europe met the requirements and standards to be truly compliant, with 36% of published APIs containing technical issues, for example, adding an extra layer of complexity for TTPs. These issues are likely particularly challenging for smaller TTPs that don’t have the necessary resources — like sufficient capital, staff, and technology know-how — to build new services depending on incumbents’ individual open banking channels.
Open banking adoption is still slow, but solutions like Salt Edge Partner Program may accelerate adoption. A survey from Fiserv in November last year found that over half of FI respondents disagree (41%) or strongly disagree (13%) with the statement that they have enough information to become compliant by the mandated deadlines of PSD2 and the UK’s Open Banking regulation, for example.
Additionally, the European Banking Authority (EBA) continues to publish clarifications on issues regarding APIs under PSD2, suggesting that there’s still a lot that needs to be done to get the technologies enabling the regulation up to speed so that TTPs can use them efficiently. As fintechs like Salt Edge aim to bridge the gap between incumbents and TTPs and take over the task of figuring out the different requirements for APIs as well as compliance, we’ll likely see more solutions launching that are enabled by the new regulations.
Interested in getting the full story? Here are four ways to get access:
- Sign up for the Fintech Briefing to get it delivered to your inbox 6x a week.>>Get Started
- Subscribe to aPremiumpass to Business Insider Intelligence and gain immediate access to the Fintech Briefing, plus more than 250 other expertly researched reports. As an added bonus, you’ll also gain access to all future reports and daily newsletters to ensure you stay ahead of the curve and benefit personally and professionally.>>Learn More Now
- Join thousands of top companies worldwide who trust Business Insider Intelligence for their competitive research needs.>>Inquire About Our Corporate Memberships
- Current subscribers can read the full briefinghere.