Financial institutions in search for talent to drive digitalisation initiatives

white nick fiserv

More than half of financial institutions have difficulty recruiting the right people to support work on Open Banking initiatives.

Software development, data analysis, API product management and business operations are the areas where skills are most lacking, companies say.

The findings come from Fiserv, a global provider of financial services technology solutions, which spoke to more than 400 executives in Australia, France, Poland and the UK representing retail banks with asset values of up to $300 billion.

The research found that implementing Open Banking strategies may prove challenging as 57% of respondents said they are finding it somewhat or very difficult to recruit engineering talent for initiatives.

Among banks that have already implemented Open Banking, only 27% said they had enough people and the necessary skills to remain compliant.

Only 8% of respondents at organisations yet to implement Open Banking agreed they have enough people and the right skill sets to become compliant.

In addition, only 13% of those that have already implemented Open Banking said they are happy with their implementation and would not make changes.

Many others said they would have relied more heavily on outsourcing, with 46% saying they would outsource third-party provider (TPP) life-cycle management, and 23% saying they would outsource the complete Open Banking operation.

Nick White, vice-president, product and marketing, EMEA, Fiserv, said: “As Open Banking initiatives are being initiated around the globe, banks are beginning to look beyond compliance toward more strategic priorities including expanding solution capabilities and improving customer service.

“With many banks stating that they lack personnel and skill sets, outsourcing of Open Banking technology development and maintenance may become more common as banks look to become and remain compliant as well as capitalise on the opportunities of Open Banking.”

The survey also found that nearly half (44%) of companies felt there were opportunities to monetise Open Banking.

Open Banking initiatives are starting to gather pace globally since the introduction of the second EU Payment Services Directive (PSD2), which laid the foundations for banks to opening up accounts to approved third parties, should customers request it.

Last year, a beauty salon in Kent, UK, became one of the first businesses to successfully source a small business loan using Open Banking data.

The company, which hasn’t been named, sourced £10,000 via Funding Options, the loan comparison marketplace for small business lending, with the process taking less than 90 minutes from application to approval.

Digital small business lending pioneer iwoca recently connected leading banks Barclays and HSBC to its platform through Open Banking.

The finance company now has connections to three of the UK’s largest banks following its first ground-breaking agreement with Lloyds Bank.

Other organisations including Nordic bank Nordea have revealed initiatives, including a shift to monetising services.

Nordea has launched an instant reporting service that allows corporate clients to digitally access their accounts and integrate real-time data with their own systems and processes.

It is the first offering from Nordea that moves beyond legal requirements of PSD2 by offering a commercial product.

Download the full Fiserv report here.