The banking industry has undergone rapid change in recent years with the rise of virtual currency, fintech and digital innovation challenging the status quo. One of the key developments emerging in the last couple of years is the concept of Open Application Programming Interfaces (APIs) for use in the banking industry, or Open Banking.
APIs are a set of rules that govern how one type of computer software communicates with another. They enable bank customers to share their personal financial information with third parties, to generate opportunities for better deals on financial products and to use transaction data to access and compare products easily. From the banks' perspective, the technology enables them to remain competitive by providing them with opportunities to provide improved, customer-friendly services and reach out to untapped markets.
An Open Banking community has recently emerged in Hong Kong, following efforts by the Hong Kong Monetary Authority (HKMA) to formulate a policy framework on Open APIs to facilitate the development and wider adoption of APIs by the banking sector.
Please click here to read our briefing on the HKMA's initiative as well as the initiatives in Singapore and Australia relating to Open Banking.
Disclaimer
Herbert Smith Freehills LLP has a Formal Law Alliance (FLA) with Singapore law firm Prolegis LLC, which provides clients with access to Singapore law advice from Prolegis. The FLA in the name of Herbert Smith Freehills Prolegis allows the two firms to deliver a complementary and seamless legal service.