David Beardmore, Ecosystems Development Director
We felt a frission of excitement to see the launch of the Smart Data Council by the Department for Business and Trade and minster Kevin Hollinrake MP. This is an encouraging step forward in the UK embracing the opportunities of consented data sharing for consumers, businesses, and the economy. As the world’s leading pioneers of data sharing ecosystems and the Trust Framework that underpins them, we know first-hand the possibilities that this development will bring to the UK.
We’ve seen the success of Open Banking with over seven million users now active in the UK. It’s clear that the appetite for these types of services exists, not only from consumers and small businesses who wish to access them, but in the sector itself with an ever-increasing number of service providers and vendors entering the market. There’s no reason to doubt that we would see an equally vibrant picture emerge in other industries.
From Raidiam’s perspective and our involvement in the successful Open Insurance in Brazil, we know how other sectors can quickly take advantage of what’s been done with Open Banking initiatives and build upon them. We’ve been calling for the UK to grasp the opportunity it created for itself by being the first to embark on Open Banking but recently has been at risk of losing this leader status as other countries seek to overtake with evermore ambitious plans.
By convening this Council made up of industry and regulatory experts in technology, Open Banking and other sectors who could benefit from the same capabilities, the UK is setting itself up to make the most of the opportunities presented in a joined-up and effective way and we are right behind it.
From my experience of developing ecosystems and advising governments around the world, here are my five key takeaways that I’d encourage the Council to consider in their discussions:
- Don’t reinvent the wheel
The underlying principles of data sharing are the same regardless of sector, purpose or data type. Everything that is needed to deliver and implement a safe and secure ecosystem already exists and is proven to be successful. We have the technology, the Trust Framework, and the conformance and certification services. The hard work is already done so time shouldn’t be wasted on looking back but instead invested in putting it into place in a way that delivers the best possible outcomes for all parties as soon as possible.
We have global open standards that are built on the highest security levels and are suitable for all. Their consistent use means ecosystems can be interoperable, delivering even more potential benefits with cross-sector data sharing, and implementation costs are kept as low as possible (particularly for those firms involved in more than one sector), all with the reassurance that the same highly secure requirements are being met.
- Enable innovation to flourish
A data sharing ecosystem, using the trusted and proven technology and standards that already exist, can be technically up and running in a matter of weeks. World-class certification and conformance services can be put in place to ensure participant compliance is effectively tested and monitored. But is that ecosystem going to be considered successful if the ability for its participants to offer innovative and enticing products and services to customers is hampered by regulatory requirements?
Embracing the opportunities of consented data sharing is about far more than making sure the process itself is sound, regulators also need to be considering how they can ensure the broader regulatory framework enables the providers of these services and products to be creative and offer compelling, competitive propositions. The risk otherwise is that consumers and service providers alike will simply not see the point of getting involved.
- Address governance and funding early on
These are the two elephants in the room when it comes to any form of industry collaboration, and not addressing them early on will overshadow and hold back positive developments. They’re not easy to tackle but agreeing solutions that are broadly agreeable to all the key stakeholders will pay dividends. Having an appropriately empowered lead body and governance structure will help to ensure the implementation programme is adhered to and there is a high level of compliance from participants.
- User experience is key
Ensuring a frictionless customer journey is a phrase frequently used when talking about designing new services, and this is no exception. The path to sharing their data and accessing the products and services on offer needs to be smooth but with just enough action involved to provide reassurance that the appropriate security checks are in place. But it’s not just customers that this applies to – third party providers (TPPs) who wish to participate and offer these innovative services equally need the process to not be unduly difficult or burdensome.
These TPPs are often small businesses who have limited resources but are able to offer customer propositions that simply aren’t matched by the largest providers, and this is fantastic for competition and customer choice. An ecosystem needs to be designed in a way that enables their participation with as little burden as possible, but without compromising the security or integrity of the system (which, incidentally, is exactly what the latest iteration of our Trust Framework addresses).
- Education, education, education
Consumers have been told for decades to keep their personal information private and be suspicious of anyone asking them to share it. Whilst the change in this message will not be new given the advent of Open Banking, it will still be a challenge to bring about a shift in mindset across a broader spectrum and do it in a way that does not open up new opportunities for fraudsters. People are naturally suspicious and we don’t want this defence to be lost, but effective education about what level and manner of data sharing is appropriate and what’s in it for them will be key to ecosystem growth and success.
Education is just as key from the industry perspective. To help secure their buy-in and motivate participants to embrace new smart data requirements, there needs to be a process of communicating the benefits that this can provide to them. It should be seen for what it is in this increasingly digitised world – an investment in their business, future growth, and ability to meet ever demanding customer expectations. Building the internal systems and processes to participate in an industry-level ecosystem provides a springboard for maximising their own opportunities, whether that be developing new revenue streams, finding cost-cutting measures, or simply being more efficient in business operations.
We’ll be following the discussions of the Smart Data Council with great interest and stand ready to lend our expertise in any way we can to ensure the timely development of recommendations and proposals.