FDX 2024 Insights: The Future of Open Banking with Claire Robinson

FDX Global Summit Spring 2024 took place in Washington, DC from March 12-15. Our VP of Product, Claire Robinson, joined a panel of experts on March 15th to discuss "Driving Adoption of Open Finance in the Commercial Banking Sector”. This article explores the key insights Claire presented during the discussion.

The Panel

As the Vice President of Product at FISPAN, Claire Robinson oversees the entire product lifecycle from client-driven exploration to successful implementation. With her extensive background in managing relationships with three of the largest banks in the United States, Claire has acquired invaluable expertise in delivering embedded banking solutions. Leveraging this experience, she now leads the Product team in developing innovative solutions that effectively address the needs of banks and their corporate clients while driving tangible value.

During the FDX Global Summit, Claire joined an expert panel including Robert May, SVP of Corporate Embedded Finance at PNC, David Ritter, Director of Financial Services Strategy at CI&T, Florian Wahl, Product Strategy and Strategic Initiatives Lead at Akoya, and Joe Lindsay, SVP and CTO of Open Data Platforms at Experian. They discussed the future of Open Finance, its challenges, and opportunities. 

During this discussion, Claire shared invaluable perspectives on the future of commercial banking.

Barriers to Open Banking Adoption in Commercial Banking

Addressing the question of why open banking hasn't seen widespread adoption in commercial banking, Claire highlighted a crucial factor—integration. 

“I believe we are seeing a lack of open banking adoption by commercial clients because there is not a readily available, seamless-to-onboard-to solution out there for them. To date, the majority of open banking solutions have focused on the retail space, leaving a huge opportunity for product and solution development in the commercial space. While the open banking use cases across the retail and commercial segments are similar, the solutions and solution delivery methods vary greatly. It is FISPAN’s experience that the majority of commercial clients have 2.5 banking relationships. This means that they are toggling between 2.5 bank portals to understand their overall cash position. Think about the possibilities for improvement in this single use case alone with the introduction of open banking…”

The complexities of corporate use cases within commercial banking emerged as another barrier to adoption, as Claire articulated: “Within commercial banking, various levels of entitlements, controls, and authentication present challenges that are more intricate to address in the business environment. Hence, this complexity poses an additional obstacle. Often we see the decision makers in a corporate entity are so far removed from the day-to-day use cases that open banking could solve, that we are going to see a key challenge to adoption being the approval and authorization flows required to set up and onboard to open banking products. Education on what the product does, how it does it, and most importantly what data is being shared and to whom is going to be critical to successful adoption of open banking in this sector.”

Looking ahead, Claire shared an optimistic perspective on the future of Open Banking adoption: “As FIs, Fintechs and regulatory bodies like FDX mature in their open banking standards and requirements, the opportunities for all members of the ecosystem to benefit are endless. I have no doubt that open banking adoption in the commercial segment is next to take off.”

The Future of ERP Integration

Acknowledging the existing challenges, Claire contemplated the future of ERP integration. Advocating for open and standardized APIs tailored for ERPs, she said:

“But someday we might see an FDX-for-ERP that will promote Open and standardized APIs for ERPs as well. Only time will tell!”

Claire stressed the importance of both early adoption strategies focusing on short-term solutions that address immediate pain points and thoughtful effort put into educating decision makers and users of these solutions. These strategies closely align with FISPAN's current focus on cash management and payment automation, recognizing the significance of providing solutions that deliver tangible benefits in the short term.

Open Banking's Role in Cash Management

Highlighting the significant opportunity presented by open banking, Claire emphasized the pivotal role of banks in cash management: "With the rise of open banking, there is a significant opportunity for banks, especially in the domain of cash management, if they embrace the role of data aggregator and processor."

“When a bank can pull together all a client's bank accounts onto their platform, that bank suddenly becomes the most important bank to the client. Through platforms like FISPAN, they even become a central hub for connecting all their bank accounts to their ERP systems.”

Leveraging Financial Data for Competitive Advantage

Claire delved into the challenges of data sharing in the current landscape—emphasizing the hassle of paperwork and manual steps involved. 

She envisioned a future where open banking streamlines data sharing between banks: “In this evolving landscape, where data flows seamlessly, banks that can effectively aggregate and leverage financial data will gain a competitive edge. For instance, envisioning advanced applications like AI-powered cash forecasting opens up new possibilities for innovation.”

Working with partners like FISPAN to connect to ERP data opens new business cases, enabling banking clients to access crucial accounting information like balance sheets, accounts payables, and receivables—and perhaps even lending opportunities.