A Guide to Open Banking Platforms in Europe

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It has now been almost seven years since the European Commission adopted the revised Payment Services Directive (PSD2) and almost three years since the deadline for all businesses in the European Union to comply with the technical standards of PSD2 .

Stepped up to help banks meet the requirements of the directive and create the necessary infrastructure for account-to-account payments, several open banking platforms have risen to prominence in recent years.

As open banking matures, different platforms are honing their specialties and key players are defining their place in the emerging ecosystem.

It is difficult to compare open banking platforms as there is no standard measure of coverage and different providers tend to specialize in different regions.

For example, in terms of the total number of connected banking APIs, Nordigen leads the pack, but that doesn’t necessarily mean it’s the right choice for a business that wants to start accepting open banking payments.

Read more: GoCardless Secures Open Banking with Nordigen Buy

Nordigen is more into the data aggregation business than the payments game. That said, last month GoCardless reached a deal to acquire the Latvian fintech, which will see Nordigen’s impressive access to European bank accounts integrated into the GoCardless payment system.

Open banking and payments

One of the most frequently cited leaders in European open banking is Tink. The Visa-owned company has built a reputation for reverse engineering banking APIs and is able to offer businesses direct access to data that goes well beyond transaction records.

Tink’s API can access a huge range of financial data while the company has also built some of the most powerful analytics and categorization tools on the market. Tink has proven to be a particularly popular supplier to some of the biggest names in the industry and has clients ranging from traditional banks to innovative FinTechs.

More recently, Tink enhanced its offering to lenders with the addition of Expense Check, a real-time credit scoring tool that helps loan originators get an accurate picture of a customer’s creditworthiness based on complete and up-to-date transaction data.

More on this: Tink gives lenders real-time insight into loan seeker spending

In terms of initiating payments, TrueLayer could well claim the title of the first open banking platform in Europe. The UK-based FinTech enables any app developer to integrate open banking payments, including variable recurring payments, and was one of the companies that helped drive the adoption of open payments in the UK United.

Continue reading: TrueLayer introduces variable recurring payments

Plus, in the connected global economy, TrueLayer can help facilitate open banking payments far beyond UK borders. And through a partnership with Singapore-based cross-border payments platform Thunes, TrueLayer is integrated into its platform as one of the payment methods for Thunes’ 100,000 merchants globally.

Related: TrueLayer, Thunes Team on Open Banking Payments in Europe, UK

TrueLayer is an interesting case because it provides both an infrastructure and a payment method. In other words, it does the work of aggregating account data and mediating between APIs, but also bundles its technology into a payment solution that merchants can use.

Another London-based company that is generating a lot of excitement in the field is Yapily. Unlike TrueLayer, Yapily focuses on the infrastructure layer and leaves the payment side of things to its partners, including real-time payment specialist Volt, which uses the Yapily API to power its open payment gateway.

Also related: Pleo teams up with Yapily to fuel SME cash flow

Not to be confused with Volt, Amsterdam-based open banking provider Yolt provides both account information and payment initiation services to customers in the banking and finance industry, while helping to facilitate payments for a range of businesses from e-commerce to utilities and insurance.

Launched by Dutch banking group ING as a personal money management app in 2017, the company has positioned itself as a one-stop-shop for European open banking and was awarded PSD2 licenses in the UK and in the EU.

But last month ING announced it would phase out the open banking platform, citing a “rapidly evolving and changing market” as the main factor behind the decision.

Learn more: What Yolt’s Exit Means for Europe’s Competitive Open Banking Market

Besides the FinTechs discussed here, Mastercard-owned Aiia, Klarna and Token have all made notable contributions to the contemporary open banking ecosystem in Europe and will certainly continue to shape the development of the field.

To complicate matters further, non-European companies like Plaid also have a stake in the continent’s open banking project, while global card networks are unlikely to allow the bottom-up payments paradigm to leave them in the dust.

For example, even though open banking is being hailed as a way around Visa and Mastercard, both companies also have a stake in its continued growth, the former via Tink and the latter via Aiia.

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